The division of labor is an important concept in economics. When workers focus on one small aspect of production, their efficiency increases, and as they do not have to switch tasks, they further save time and money.
Learning Objectives
In this lesson, we will cover
- What is the division of labor?
- What are the benefits of the division of labor?
- What are the problems of the division of labor?
What is the division of labor?
It involves the separation of a work process into a number of tasks, with each task performed by a separate person or group of persons.
The concept of division of labor is most often applied to systems of mass production and is one of the basic organizing principles of the assembly line.
The idea of division of labor was introduced by Adam Smith in his famous book, The Wealth of Nations (1776). He stated that the way goods or service is produced is divided into a number of tasks that are performed by different workers, instead of all the tasks being performed by the same person. Adam Smith had explained the concept of division of labor using the example of a pin-making factory. He pointed out that if a worker were to do all the tasks of pin production himself, he will be able to make 20 pins a day; if 10 workers specializing in the production of pins were to work together, they will produce 48000 pins a day.
Benefits of the division of labor
- Enhanced productivity – Division of labor will bring a vast increase in productivity.
- Increased output – The total output of goods and services will increase and the quality of goods and services will improve.
- Greater variety of goods and services – Consumers will get access to a greater variety of goods and services; thus, more wants can be met with the given amount of limited resources.
- Competition and lower prices – Increased competition brings the cost of goods and services down because factories had to be innovative to remain competitive.
- Improvement in workers' skills – When a person continuously works at one task for a longer time, they become experts on that task.
- Encourage inventions – When a worker is doing the same job over and over again, he always looks at how to make the work easier and simplify the process steps. This may stimulate innovative production methods.
- Save training time and efforts – As each worker has to perform one task, the learning curve is much shorter. The apprentice/trainee can pick up the skill faster and start delivering results.
Problems of the division of labor
- Repetition of task increases monotony and boredom – When a worker has to perform the same work over and over again, it creates a sense of boredom. This can lead to low labor morale.
- One issue and the whole production can stop – If there is a blockage in one particular aspect of production, the entire assembly line could come to a halt.
- Lack of responsibility – As each person is responsible for only a part of the production process, no one takes responsibility for the end product.
