CHAPTER 3

MEANING OF DIVISION OF LABOUR/ SPECIALIZATION

SYNOPSIS
1. Types of division of labour
2. Advantages/Disadvantages OR Merits/Demerits of
division of labour
3. Factors affecting division of labour

 INTRODUCTION
 Production refers to the conversion of inputs into outputs
which means the resources or factors of production are required in
order to produce.
 Production is a different form of creation.
 We normally say God creates and man produces.
 Creation is producing something out of nothing while
production requires resources to produce.
 In order to produce we require factors of production
namely land, labour, capital, organization etc.
 Modern production is subject to:
1. Extensive use of machinery
2. Large Scale Production
3. Growing Specialization
 Specialization implies that every person or region
specializes or concentrates in the production of one particular
commodity or service or a particular task or process of production.
 Specialization was earlier known as division of labor as
each person did one job or each region produced one commodity.
 Nowadays the term specialization is preferred to “division
of labour”

I. TYPES OF DIVISION OF LABOR

 There are three types of division of labor namely:

1. Specialization according to process/ Simple division of Labor
2. Specialization according to process/ Complex division of Labor
3. Territorial Specialization/Geographical Specialization.
1. Specialization according to process/ Simple division of
Labor

 A more common type of division of labor is specialization

by trade or by profession.
 Some are farmers, blacksmiths, cobblers etc.
 In “learned profession” too there has been specialization.
 E.g: doctor, lawyer, teacher etc
 In fact in May professions specialization is increasing.
 A good example is medicine. Formerly we had doctors who
would treat all types of diseases. But now-a-days we have the heart
specialist, the skin specialist, the eye specialist etc
 In the field of engineering we have civil engineers,
mechanical engineers, electrical engineers, chemical engineers etc.
 Thus there is specialization by trade or profession which is
also known as personal division of labor (i.e. each person doing one
occupation).
 This is sometimes known as simple division of labor.

2. Specialization according to process/ Complex

division of Labor

 In modern times, workers rarely are expected to produce a

commodity as a whole.
 In almost all cases, the production of every commodity is divided
into many processes or small tasks performed by machines
supervised by men.
 E.g.: Ina shoe factory a man spend all his life in cutting shoe
heels only. He may not know any other process. In shoe making
there are as many as 240 processes, performed by 100 different
workers on 150 machines- all engaged in producing a pair of shoes.
 In a sense division of labor according to processes, is the real
division of labor as it is this which is on the increase now days.
 Thus the production of each commodity is divided and sub-
divided into small parts.
 Each worker is asked to produce one part, perhaps with the help
of a machine.
 This type of specialization is known as specialization by task, or
complex division of labor.
3. Territorial Specialization/Geographical
Specialization

 Geographical or territorial specialization is an important form of

division of labor.
 Specialization in this type is often based upon differences in
natural conditions.
 In India much of raw cotton is produced in Maharastra where the
soil and climate condition are favorable to its growth.
 Bihar is known for its coal and iron deposits and Assam for its oil
and tea.
 Certain natural resources such as coal, iron ore, manganese,
petroleum and tin are found in those regions in which they have
been deposited by nature.
 Thus specialization may be based on natural deposits and
advantages of soil and climate.
 But it is also possible for specialization to be based on artificial or
developed conditions.
 E.g: Bombay was the center of cotton textile industry since the
middle of the last century.
 But this industry has spread out to other parts of the country.
 At present, Ahmedabad, Kanpur and Coimbatore in Tamil Naidu
have become important centers of cotton textile industries in India.
 Thus we find that growing specialization of people, processes
and by different regions has been made possible because of trade.
 Unless goods produced can be exchanged or sold there is no
scope for specialization.
II ADAVANTAGES/DISADVANTAGES OR MERITS AND
DEMERITS OF SPECIALISATION

1. Advantages/Merits of Specialization
 The following points are the merits of specialization
a. Best utilization of utility
 Specialization makes it possible for each individual
to use his ability in the best possible manner and produce
that which he knows best.
 Every person has his peculiar character, ability and
aptitude.
 Some people are especially good for mental work wile
others can do only manual work or physical work.
 Some are good as doctors, some as engineers, some as
lecturers, some as gardeners and so on.
 Division of labor makes it possible for every worker to
undertake a task that is particularly suitable to his own desires and
abilities.
 Production is maximized because one works and
contributes to production to the best of his ability.

b. Getting Skill
 Specialization leads to the attainment of great dexterity and skill.
 In many manual and even intellectual operations, great skill is
acquired only through long training and constant practice.
 E.g.: A typist in the beginning lacks experience and so makes
many mistakes but with practice he improves and if he practices
constantly he would become an expert.
 In short, “Practice makes a man perfect”.
 After continuous performance of the same task a person
becomes na expert or a specialist in that job.

c. Removes Waste of time

 Specialization removes waste of time and assures continuity of
operation.
 In the past it was a common thing for workers to divide their time
between agriculture and manufacture, spending part of their time in
cultivation their small farms and the remainder in spinning yarn or
weaving cloth.
 This obviously involves loss of time in moving from one work to
another.
 But specialization helps to remove this type of time-wastage.
 A worker performs only one task and one task alone and
therefore handles only one tool.
 He need not lay down one tool and take up another.

d. Simplification of Tasks
 Specialization has led to simplification of tasks.
 In the past and in some cases even now, worker has to be
apprenticed for three, four more years to learn a particular trade
and become carpenters, weavers, blacksmiths, masons and so on.
 But now a day each job has been divided into simple tasks so
that even a small boy can be trained in a task in a few days.
 Henry Ford, the famous American car owner, claimed that in a
modern car factory 43% of the jobs could be learnt in one day and
36% of the jobs have been simplified and an average worker can
take up any factory job without serving a long period of
apprenticeship.
 This is the result of specialization.

e. Use of machinery
 Specialization has facilitated extensive use of machinery.
 Division of labor implies dividing complicated jobs into simple
jobs into simple tasks or processes.
 Each process is so simple and has to be repeated hundreds and
thousands of time a day that it could easily be entrusted to a swift
and accurate machine.
 E.g: A cobbler is sued to stitching the shoes with his own hands.
Now in a shoe factory special sewing machines stitch shoes.
 The work which was formerly done by hand has now been turned
into a machine operation.
 The use of machinery leads to faster and greater production.
 Besides machines can do everything accurately.
 Machinery has helped man to control nature.
 It has relieved man much of the heavy and dirty work.
 It has helped to create more jobs.

f. Greater mobility of labor

 Specialization has also led to greater mobility of labour between
occupations.
 In many large factories, much of the work is done on automatic
and semi—automatic machines and there is in general, a similarity
of machine operation.
 This has enabled workers to move easily from one job to another
and from one industry to another in search of higher wages and
salaries.

g. Promotion of large scale production

 It leads to large scale production.
 In the last 200 years or so there has been growing specialization
in every line of production.
 Machinery is extensively used and production is carried on in
large factories.
 The result is large scale production and lowering costs of
production.
 E.g.: In the USA cars and refrigerators are produced in millions
of units and the cost of production is very low.
 Even ordinary works have come to buy cars and refrigerators.
 They enjoy high standards of living.

2. Disadvantages/Demerits of Specialization
 The following points are the demerits of specialization:

a. Work becomes monotonous and boring

 Doing the same work over and over again without any
change produces mental fatigue,
 Work becomes irksome and monotonous,
 There is no pleasure in the job.
 The workers cannot be expected to take any interest.
 The quality of work must suffer.
 E.g.: In a large shoe factory a workers will be cutting heel,
all year round instead of doing the entire work of making shoes.

b. Loss of interest in work

 The people who manually produce their products like shoe-
makers etc feel proud about their work and feel as though they
have accomplished something.
 A modern day factory worker, due to specialization, has
absolutely nothing to be proud about.
 He is one among hundreds and thousands of workers in a
factory.
 Monotony also causes a loss of interest in the work of modern
day factory workers.
 The workers may not be even given any responsible work such
as buying of raw materials, or selling of the finished product.
 Doing the same thing over and over, will definitely lead to loss of
interest.

c. Lack of proper development

 The worker at some unconscious level wants to try out new
things but he cant as all he has on his side is this one tiny bit of
work which really does not count as experience outside.
 Hence we can say that the worker is unable to develop
himself and his skills in other aspects of the production.
 So it leads to lack of proper development.
 A modern day factory worker, due to specialization has one
particular job which is quite un-noticeable .
 E.g : A worker using his hand only, will use his hand all his life.
 As a result some of his faculties are over-developed while others
are neglected.
 John Ruskins wrote “It is a sad account for a man to give of
himself that he has spent his life on opening a valve, and never
making anything but an eighteenth part of a pin”

d. Defects of the factory system

 Specialization leads to the rise of large factories and workshops
and thus is responsible for all the evils associated with the latter.
 This implies in the first place a huge amount of money.
 The control of the business unit, therefore passes into the hands
of a few individuals while the workers are simply wage-earners,,
 The workers do not own the tools nor do they own the product.
 Accordingly, they are completely dependent upon the owners of
the factories.
 Secondly, the modern factory system of production is subject to
business charges that is ups and downs in business.
 Sometimes business is good and sometimes it is bad.
 During a good period, business picks up rapidly; prices are rising
so are profits, production and employment are also on the increase.
 But during a bad period, say a business depression, things are
bad; millions of workers may lose their jobs.
 Production is reduced, and national income declines.
 There is nothing so useless and bad as a business depression.

e. Exploitation of workers
 Specialization may lead to the exploitation of workers.
 Exploitation means that the workers are forced to work for long
hours and are paid low wages.
 In the earlier system of production, each one was producing for
himself but in the present system, everyone works for the owners of
factories and workshops.
 In the 19th century, workers were forced to work for 16 hours a
day in 19th century England
 But workers organized themselves in trade unions which fought
for the causes of workers.
 In western countries and America, workers are no more exploited
and their standard of living is very high.
 But in India and other backward countries, trade unions are
comparatively weaker and therefore have not managed to get good
wages and good working conditions for the workers.

f. Greater inter-dependence
 Specialization is responsible for greater inter-dependence
between individual, communities and even nations.
 Every man produces a small part of work in a factory.
 Consequently for the successful working of the factor, very man
depends on everyone else.
 Every factory depends upon others for its raw material or to use
its finished products.
 This mutual dependence helps the economy to work smoothly
but any difficulty in some part of the economy will upset the entire
economy.
 E.g.: Suppose there is a failure of sugarcane crop in UP.
Naturally, the sugarcane farmers of UP would suffer serious losses
of income. The decline of the income of the farmers will reduce their
demand for goods and services. Further the failure of the sugarcane
crop will force most sugarcane factories to close down, partially or
fully. Workers in sugar mils will be left unemployed and the demand
for other connected goods will also come down.
 This decline in demand for goods and services will lead to a
decline in their production and increase unemployment.
 This a depression in sugar industry in UP is passed on to many
other industries also both in Up and the whole of India.
 This specialization has been responsible for increase dependence
among people, communities and countries.
  The dependence has bad effects in certain periods.

g. Control by Powerful countries

 Finally, one of the dangers of specialization economic
imperialism which it may give rise to.
 Specialization resulting in large scale production assumes the
existence of a large market or requires the creation of a large
market.
 If the country it self is inadequate support large scale production
at a particular time, it is necessary to search for the market
somewhere else.
 Asian and African colonies were established in the 19th century to
serve as markets to life the goods produced in England, Germany
etc
 In these days there are some powerful companies of advanced
countries particularly in the USA- known as international giants or
multinationals- which attempt to control markets for their products
in many countries.
 Not only that they attempt to control economic and political
policies of developing countries.

III. FACTORS AFFECTING DIVISION OF LABOUR

 In early times, production was limited, but in the course of time,
specialization has gained importance and become an important
aspect of production everywhere.
 When each person performs one task or each region produces
one commodity, it is called division of labor.
 Today the term specialization is referred to division of labor as
not only labor or workers can specialize, but specialization can be
seen in either factor of production.
 There are three types of specialization namely:
i. Personal/Professional Specialization.
ii. Specialization by tasks/ processes.
iii.Territorial Specialization.
 Specialization and use of machinery has led to large scale
production.
 The following factors affect division of labor:

1. Availability of Capital
 This is one of the most important factors
affecting specialization as there is the use of machinery on a large
scale and therefore finance or credit facilities have an important
role to play in setting up industries and encouraging specialization.
 Thus banks and financial institutions which
provide adequate, timely and cheap credit give a boost to
specialization.

2. Market size
 According to Adam Smith “ is limited by the size of the
market as determined by the degree of specialization”
 Specialization leading to large scale production would be the cost
of production and evidently the size of the market or the cause
extension of the market.
 Thus larger the size of the market, larger the degree of
specialization and vice-versa.
 The extent of market refers to the volume or effective demand
for a product.
 Therefore whatever increases the size of the market , also helps
to increase specialization.

3. Availability of transport and communication.

 Cheap transport cost encourages specialization as it helps the
industry to bring cheap raw materials as well as to carry finished
goods to the market centers.
 Thus various quick modes of transport-roads, railways, airways,
water-ways and their cheap availability facilitates specialization and
a good network od communication provides complete market
information.

4. Availability of raw materials and power.

 Nearness to the sources and cheap power of ……………. Has
been an important factor affecting specialization because
specialization uses machines and mechanical operations require
power.

5. Geographic Advantage.
 Territorial specialization is greatly affected by special
geographical advantages which a particular region may enjoy like
nearness to the sources of raw materials, climate, temperature, soil
fertility, rainfall etc.
 Specially in case of bulky goods we find that industrial units are
located near the source of raw materials.
 i.e.: Why U.P specializes in the production of sugar and Bihar in
coal, iron, steel etc.

6. Religious and historic factors.

 Sometimes religious and historical factors also affect
specialization.
 E.g.: bell- metal industry in pilgrimage centers or the location of
silk industries to embroidery units in places where ……….. sings and
courts of native slaves/kings existed.
 Sometimes specialization occurs by “pure choice” like for e.g.:
the car industry in Detroit (USA) which was Henry Fords own home
town.

7. Government Policies/ Political Factors.

 Sometimes governments incentives and policies become
important factors in setting up plants in certain areas.
 Economic advantages or government subsidies, tax
holdings, rebates etc encourage specialization in certain areas
specially to set up industrial units in the background regions.

8. Availability of Labor.
 If skilled labor is available it will be a great advantage of
specialization as specialization requires abundant technical
skills/ technical know how etc

 There are other minor factors affecting specialization

namely:
9. Marketing ability.
10. Personal interest, aptitude, talent,
initiative etc.
11. Increased Population
12. Removal of trade restrictions.
13. Increased use of machinery.
14. Level of literacy, technical training,
inventions, research etc.

 Thus specialization is affected by a number of factors,

specially the economic advantages by the availability of raw
materials, adequate power, good market, reduction of transport
costs are important factors effecting specialization.