Division of Labour 


Welcome to class! 

In today’s class, we will be talking about the division of labour. Enjoy the class!

Division of Labour classnotes.ng


At the end of the lesson, you should be able to;

  • Analyse the concept of division of labour
  • Identify and explain the merits and demerits of division of labour
  • Distinguish between division of labour and specialisation 

Division of Labour 

It is the breaking of production processes into smaller units or processes with each process being undertaking by a worker or group of workers. Division of labour is a complex process mainly practised in an industry where workers specialize in the production of a small portion of production, and may not see the end product and may not make use of it.

Origin of division of labour

Adam Smith (1723 – 1790) popularly called the “Father of economics” established the theory of Division of labour in 1776. He visited a pin-making factory place where he found out that eighteen (18) processes are involved with only ten men working there producing 20 pins a day.

He concluded that if each process is handled by different individuals more pins will be produced. The theory was applied and as a result, 48,000 pins were produced daily. This development was the origin of the modern-day division of labour.

Examples of division of labour
  1. Division of labour in domestic work.
  2. Division of labour in factory/industry
  3. Territorial division of labour among separate firms, eg Textile industry
  4. Extensive division of labour among different countries
  1. It leads to higher productivity.
  2. It encourages specialization.
  3. Creation of job opportunity is possible.
  4. There is product standardization.
  5. It saves a lot of production time.
  6. It encourages the use of machines.
  7. Work becomes less fatigue.
  8. Easy training of workers.
  9. It encourages inventions and innovations.
  1. The monotony of work.
  2. A decline in craftsmanship.
  3. The use of the machine reduces employment opportunities.
  4. Some machine can badly affect the health of the workers.
  5. Increase in interdependence among individuals and industries.
  1. The size of the market: The extent to which goods and services produced are demanded will determine whether or not division of labour will be applied since the main reason for it is to increase supply.
  2. The nature of the product: Certain responsibilities or services cannot be divided e.g. hair cutting, driving, farming etc.
  3. Availability of Factors Inputs (e.g. Labour )
  4. Capital Availability
  5. Level of Technology Availability
  6. Managerial Competence
  7. Technical Difficulties


  1. What are the major advantages of division of labour?
  2. What are the limiting factors to division of labour?


It is the process by which an individual, a firm or a country concentrates his or its productive efforts on a particular line of production in which he or it has the greatest advantages over others. That is, it is the act of limiting one’s productive efforts to a particular aspect of economic activity. Division of labour is one aspect of specialization.

People could specialize in law, medicine, teaching, sport etc. Specialization is a result of the Division of Labour. This process depends on the type, size of the firm and goods and services produced. Though it applies to the industrial and agricultural economy, it is useful in family and individual set-ups.

Types of specialization
  1. Specialization by Process: is the type in which production process is divided into different stages for each skilled worker in an industry.
  2. Specialization by Sex: is the type in which certain occupations are exclusively either for male or female as dictated by custom, tradition or by law.
  3. Specialization by Product: is the type in which an individual or a firm concentrates on the production of a particular commodity.
  4. Geographical/Territorial Specialization: is the type in which certain region or territory specializes in the production of a particular commodity


  1. What is specialization?
  2. Briefly explain the four types of specialization

Reading assignment

Amplified and Simplified Economics for SSS by Femi Longe Chapter. 4 pages 49-53

Fundamentals of Economics for SSS by. R.A.I. Anyanwuocha Chapter 8 Pages 75 – 82.

General evaluation
  1. Why do we study economics?
  2. Define economic rent.
  3. What is quasi rent?
  4. List the agents of an economic system.
  5. What is the importance of macroeconomic?
  6. Define division of labour and specialization.
  7. Explain the factors limiting the use of division of labour.


In our next class, we will be talking about the Scale of Production.  We hope you enjoyed the class.

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