[hn_throwaway_99]

Actually, it does, and that's why folks are arguing for comparing profit instead of revenue per employee.

As others in this thread have pointed out, if you utilize tons of contractors, your revenue per employee may look huge, but your profit per employee will go down because you still have to pay all those people. Whether you use contractors or employees, it still comes out of your bottom line.

Now, I assume what you are really arguing is that loads of Foxconn contractors should increase the denominator in the "per employee" part of the equation. But that's why profit is a better metric, because if you look at profit per employee of Foxconn, you'd see it is much, much lower than Apple.

[darkmighty]

Tbf, those are trivially not mathematically equivalent (even taking profit instead of revenue). Suppose each contracted worker cost $1/yr in salaries, and there were 1000 contractors/1000 in-house employees. Then without including contractors, the profit per employee is (X-1000)/1000 ~ X/1000, while including it is (X-1000)/2000 ~ X/2000, much lower. Including or not contractors does have a potentially large difference.

[daveFNbuck]

The trick here is that contractors aren't employees, so they only affect these metrics by reducing profit.

[mywittyname]

They are mathematically equivalent in the sense that they are both equally worthless measurements for the same reason. In both cases, contractors contribute the the numerator without contributing to the denominator.

Using profit seems slightly better (theoretically, it gauges how effective management is at converting contractor effort into profit). But we all know that you can't compare the term "profits" between industries, whereas, revenue is consistent no matter what your business is.

[tjr225]

Why should I believe that the statistic does include foxconn workers? I'm asking this sincerely.

[hn_throwaway_99]

To clarify, I'm arguing that the metric is: (Net Earnings of Apple) / (Number of Apple Employees). What I'm saying is that the net earnings of Apple by definition subtracts out the money paid to Foxconn to build Apple's products.

I'm not arguing that the number includes the Foxconn employees in the denominator, and it shouldn't, because the numerator (Apple's net earnings) doesn't include money paid to Foxconn (as that's a cost of goods sold for Apple).

[slavik81]

It is a better measure, but it's still pretty arbitrary. Apple could achieve an even higher profit per employee just by splitting the company in two: put all the capital in one company and all the employees in the other.

I wouldn't read too much into any of those measures.

[maphar]

They mean that what Apple pays to Foxconn reduces Apple's profit, but does not reduce Apple's revenue. Profit accounts for the cost of subcontracting.

[readitmeow]

Comparing profit doesn't really make sense either. Companies like Amazon show next to no net profit cause they choose to reinvest all their money to avoid taxes and shareholders reap the benefits through capital gains.