In developed economies, most workers specialize in performing particular tasks in production of a good or service. Very few workers make a complete product. Firms, regions and countries. For example Sri Lanka and The Maldives, concentrate on tea and tourism respectively.
The division of labour id the splitting of the production process into a number of individual operations and making each operation a special task of one worker. So it involves workers specializing. For example, in a Hotel, some workers are will be employed as housekeepers, waiters, receptionists, managerial staff, chefs etc.
There are many reasons put forward as to why division of labour may increase productivity hence lower average (unit) costs of production. These include,
1 A person who spends his or her time performing one relatively simple task becomes very efficient at that particular task
2 No time wasted on in moving from one job to another
3 The savings on equipment. If workers specialize, they will not need to have a full set of tools or other equipment.
4 There is a saving time on training of operatives. An employee could be easily trained for a particular task he or she specializes in, in a short period.
5 Is a saving on skills. Specialization means that many different occupations are created, each one, which calls for some particular aptitude. It is possible, therefore for each worker to specialize in the job that suits her/him best.
6 It makes possible a greater degree of mechanization. When a complex process is broken down into a series of separate, simple processes, it is possible to devise machinery to carry out individual operations. With advances in technology, it is becoming possible to mechanize more areas of production.
A system of specialized production, no matter how simple cannot exist without exchange. When people become specialists they are dependent upon some system of exchange to provide them with the variety of goods and services required to satisfy their wants. For example, without some means of exchange, farmers would have too much rice for their personal needs but would not have coal, oil, electricity or machinery. There must be some means whereby the outputs of specialist producers can be exchanged. In most economies the use of money enables people to exchange labour for a wage which in turn is exchanged for a wide variety of goods and services.
The principle of the division of labour can only be applied extensively when there is a large market for standardized products. For workers to specialize, output must be high enough for each worker to carry out specialized tasks.
For example, within the car industry there’s a considerable amount of specialization. In the production of popular models which are produced in large quantities. However there is less scope for the division of labour in the production of racing cars which are produced to in much smaller quantities and individual designs. The size of the market, and hence the opportunity to apply the division of labour, also depends o the existence of a good transport system which facilitates the distribution of products.
As briefly mentioned above the application of large scale machinery is only worth while if there’s a market (i.e. a potential demand) large enough to keep the equipment fully employed. However, as micro technology becomes less costly, it becomes possible for firms to cater for smaller markets. For example, desktop publishing means that now even relatively narrow interests, such as bird keeping can have specialist magazines produced for them.
When labour and other resources become very specialized it can become difficult to adapt quickly and smoothly to changes in methods of production and changes in demand. For example, a chemist might find it hard to switch to being an accountant if the demand for chemists fall, whilst the demand for accountants increase. Indeed, much is designed for a specific task and cannot be used for other purposes.
Modern technology allied to the extensive use of the division of labour has mad enormous increases in the output of goods and services possible. It has transformed the living standards of millions of people, removed much of the back-breaking toils from people’s daily labour and made possible an increase in leisure time.
However the loss of job satisfaction, particularly in manufacturing industries, is causing some firms to consider various projects aimed at achieving job enrichment by enlarging the role and responsibilities of the workers.
For example, Volvo moved from specialization in order to increase the quantity and quality of output. Allowing workers to undertake a number of different tasks may increase workers’ enjoyment of their job, identify their strengths, increase their ability to make suggestions for improving production methods and the product, enables workers to cover for colleagues who are sick or undertaking training and increase labour flexibility.