Everyday individuals apart of the workforce contribute to the growth and production of a business. Often, these individuals are hired to perform a specific task or duty that they are deemed qualified for and that is deemed necessary for a company to meet their overall goals. The distribution of tasks, skills and duties are often referred to as the division of labor. Use of division of labor can be dated back to ancient civilization and the benefits of such division is attributed to the growth and development of today’s modern capitalistic economies (Clemson Institute for the Study of Capitalism [CISC], n.d.). Division of labor in today’s society is considered quite complex compared to the simplistic structure used in earlier times. To understand how the concept of division of labor helped evolve ancient economies into today’s modern economy, we will exam the importance of division of labor in a capitalistic economy and how it leads to efficient production which ultimately results in a thriving economy.
In earlier civilizations, the division of labor was implemented in a much more basic way. Individuals were assigned tasks such as gathering, hunting or blacksmithing. These tasks were assigned to help the development and sustainment of the community. Societies have since grown to be a thriving capitalistic type of economy in which businesses are the driving force behind whether the economy is in good or bad condition. Most theorists can agree that thriving societies and economies are a direct result of the use of division of labor (CISC, n.d.; Boundless, 2016).
Although the concept of division of labor can be seen in all types of economic structures, the benefits of such a concept can particularly be seen in those that are capitalistic in nature, especially in the era of globalization. This could be the very reason why some economic theorists believe that the concept of division of labor applies directly to the success of a countries economy (Boundless, 2016). Countries with thriving economies tend to have a complex division of labor used by corporations for profit, which in turn drives the economy up. Countries that do not have thriving businesses to implement a labor hierarchy that could help sustain a growing economy tend to perform poorly compared to other countries.
In today’s modern society, division of labor focuses on achieving and maintaining a high, efficient production rate at the lowest cost for businesses (Borghans & Weel, 2005). Such division allows businesses to produce more in less time while receiving max return minus expenses, which includes wages. These wages paid to workers eventually recycle back into the economy, thus promoting prosperity amongst businesses and citizens.
The benefits of division of labor in relation to productivity may seem simple. It only makes sense that by dividing up tasks, one can achieve the end results in less time. However, in today’s economy, productivity is much more complex in nature. There are many pieces that play into the function of business including research, product development, accounting, management, general labor and so on. With such complex functions, the need for division of labor is very high, especially in specialized skills such as engineering, accounting and manufacturing.
Truly, the key to complex division of labor structures leading to efficient production lies in recognizing the need for certain skills, knowing the type of individuals needed to perform such skills and then allocating duties successfully based on the job duties (Borghans & Weel, 2005). By allocating tasks based on skill and specialization, workers will perform optimally while spending less time on specified tasks, which in turn drives up productivity. Furthermore, dividing labor based on specialty allows for diverse business structure allowing for multiple departments to grow and expand, resulting in several business essentials to take place simultaneously without disrupting or taking away from another department. Overall, division of labor leads to high productivity by having the necessary number of employees who possess the necessary qualities needed to spend less while doing more (Borghans & Weel, 2005).
Because division of labor is such a commonly practiced concept, it is easy to identify such hierarchy in businesses today. Since today’s economy is quite complex, the need for such individual positions have become common place in the corporate work structure. Whether providing services or goods, companies have needs for marketing, research, customer relationships and more. Additionally, there are different levels of skills needed in each need. This has created business to have complex hierarchy and is considered normal for businesses in all industries. This became most apparent to me through my experience, especially during my enrollment of post-secondary schooling.
Post-secondary schools have a unique duty of employing the necessary individuals to help lead a large student population to successful graduation. To do such, post-secondary schools must employ individuals that can help students navigate there way, starting with the enrollment process leading to class instruction and career development. Reaching such goals requires to handle professionals who specialize in the each of those compartments. Universities and colleges who allocate these duties to the correct individuals while maintaining the necessary number of staff have higher rates of graduations, which ultimately result in a high reputation and high student enrollment.
Division of labor is a rather common economic theory that can be dated long before modern civilization. The key difference between earlier implementations and today’s application is the complexity of such labor structure. However, economic theorists agree that the development of such complex division of labor was a direct result of economic growth and commercialization that began with more basic division of labor (Boundless, 2016). Because of this growth, it can be safely assumed that proper use of division of labor pushes a capitalistic economy through the use of job specialization and duty allocation. These results are indicative that the division of labor is necessary for increased productivity and profit.