The economic term “division of labor” can be defined as the division of production in a variety of parts which correspond to workers’ specializations (Taylor, 2007, p.7). Specifically, the division of labor involves dividing the task which needs to be completed into several smaller tasks so that these smaller tasks could further be assigned to specialists that are only engaged in doing their particular assigned tasks. So, the division of labor takes place when some workers focus on one activity and others on another. Thus, specialization is inherent in division of labor (Taylor, 2007, p.7).
The importance of division of labor was first recognized by Adam Smith, who applied the term ‘division of labor’ to his worker specialization. The division of labor, according to Smith, greatly increases the productivity. The following effects of the division of labor account for this increase in productivity: 1) the division of labor makes up specialized knowledge of specific task or a specific trade; this leads to workers’ more diligent engagement in achieving the task and boosts the productivity; 2) it saves workers’ time: by centering on one particular task, workers are able to use their time with maximum benefit since they no longer need to move from one task to another; 3) workers’ engagement in particular activities makes them really proficient in these activities and leads to technological innovations. According to Adam Smith, “The greatest improvement in the productive powers of labour, and the greater part of the skill, dexterity, and judgment with which it is any where directed, or applied, seem to have been the effects of the division of labor” (Smith, 1991, p.9) Through the productivity boost, the division of labor boosts the opulence of the society, where even the most economically disadvantaged see their living standards improve. In other words, the division of labor allows faster production with fewer errors; increases the overall quality, as well as “numerical production, and productivity of a factory at reduced costs” (Waller, 2001, p.23). By the way, Smith’s vision of the division of labor was a predecessor of the operation of Henry Ford’s assembly line.
To conclude, the division of labor refers to production division in a number of parts which correspond to different workers’ specializations. The role of the division of labor in the economy is vital: it boosts the level of production through efficient time management, improved quality of production, skillful workforce, and technological innovations.