WHAT IS THE DIVISION OF LABOUR?

• The division of labour occurs where the production process is

broken down into many separate tasks.
• Division of labour can raise output per person as people become
proficient through constant repetition of a task.
• This is called learning by doing.
• The division of labour is a fundamental principle in modern
industrial economies, and it is closely associated with the concept
of specialisation.

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 REAL WORLD EXAMPLES OF DIVISION OF LABOUR

• Vehicle manufacturing: In automobile manufacturing, the division of

labour is highly evident. Each worker on an assembly line has a
specialized task, such as installing a specific component (e.g., engines,
tires, seats) or performing a particular operation (e.g., welding,
painting).
• Healthcare: Within the healthcare industry, doctors specialize in
specific fields such as surgery, pediatrics, cardiology, or radiology. This
specialization allows healthcare providers to develop expertise in their
chosen area, leading to better patient care and more efficient
diagnosis and treatment.

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 POTENTIAL ADVANTAGES OF DIVISION OF LABOUR

Division of labour involves the Division of labour can lead to

specialisation of individual tasks in higher output per person / per
a production process hour worked which means
improved productivity

DIVISION OF LABOUR TUTOR2U.NET/ECONOMICS

 POTENTIAL ADVANTAGES OF DIVISION OF LABOUR

• Efficiency: When individuals or groups specialize in specific tasks,

they become more skilled and proficient at those tasks over time.
This specialization leads to increased efficiency in production.
• Economies of Scale: Specialization and the resulting efficiency in
production often lead to economies of scale. As production
quantities increase, average costs tend to decrease. These cost
savings can lead to higher profitability for firms and more
affordable products for consumers.

DIVISION OF LABOUR TUTOR2U.NET/ECONOMICS

 WHAT IS MEANT BY “LEARNING BY DOING”?

• "Learning by doing" refers to the process of acquiring knowledge,

skills, and expertise through direct hands-on experience or practice in
a particular activity or industry.
• It suggests that individuals, firms, or societies can improve their
productivity and effectiveness by engaging in repetitive tasks, refining
their methods, and gaining insights through practical experience.
• In construction for example, skilled employees with many years of
experience develop work-flow processes that improve their efficiency,
reduce waste and increase their productivity.

DIVISION OF LABOUR TUTOR2U.NET/ECONOMICS

 POTENTIAL DRAWBACKS OF DIVISION OF LABOUR

Risks of repetitive strain injuries Reduced job satisfaction can

at work because of repeated hamper labour productivity and
tasks. This adds to the burden causes increased workplace
facing a nation’s health service absenteeism

DIVISION OF LABOUR TUTOR2U.NET/ECONOMICS

 POTENTIAL DRAWBACKS OF DIVISION OF LABOUR
• Unrewarding, repetitive work that requires little skill can cause alienation and
eventually causes lower productivity.
• Workers may take less pride in work and quality suffers.
• People move to less boring jobs creating a problem of high worker turnover
and increased hiring/training costs.
• Increased risk of repetitive strain injuries at work.
• Some workers receive little training and may struggle to find alternative jobs
when out of work – they suffer structural unemployment / occupational
immobility.
• Mass-produced standardized goods lack variety for consumers

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 IN ECONOMICS – WHAT IS SPECIALISATION?

• Specialization refers to the process by which individuals, firms, or

regions concentrate their efforts on producing a narrow range of goods
or services in which they have a comparative advantage.
• This concept is closely related to the division of labour and can be a key
driver of increased productivity, economic efficiency, and trade.
• Specialisation is often based on the principle of comparative advantage,
which suggests that individuals, businesses or countries should focus on
producing goods or services in which they are relatively more efficient or
have lower opportunity costs compared to others.

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 IN ECONOMICS – WHAT IS SPECIALISATION?

Learning by doing helps to increase Many businesses employ specialist

productivity and the quality of supply managers in the production process

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 POTENTIAL GAINS FROM SPECIALISATION
Higher labour productivity and rising business profits
• Learning by doing increases output per hour worked
• Higher productivity then lowers the cost of supply goods and services
• Increased productivity leads to higher profits for businesses

Specialisation creates a surplus output that can be traded for mutual benefit
• Businesses / countries specialize in areas of relative advantage
• Trade increases the range of products we can consume

Lower prices cause higher real incomes and GDP growth

• Lower prices gives consumers greater real purchasing power
• Higher productivity allows businesses to pay increased wages
• Successful specialization is a key cause of economic growth

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