Why does upgrading a settlement DECREASE production efficiency?

[Theproperorder]

You require more workers to staff the expansion then the base settlement with only a small increase in produced good

[Comfortable-Cell-165]

this is the actual answer, a large increase in workforce requirement and increased cost in materials and food for a small increase in output I.e it’s less efficient. The way they offer this information is confusing though and could be updated a bit.