Labour is the human input into the production process. Alferd Marshall defines labour as 'the use or exertion of body or mind, partly or wholly, with a view to secure an income apart from the pleasure derived from the work'.
1. Labour is perishable.
2. Labour is an active factor of production. Neither land nor capital can yield much without labour.
3. Labour is not homogeneous. Skill and dexterity vary from person to person.
4. Labour cannot be separated from the labourer.
5. Labour is mobile. Man moves from one place to another from a low paid occupation to a high paid occupation.
6. Individual labour has only limited bargaining power. He cannot fight with his employer for a rise in wages or improvement in work-place conditions. However, when workers combine to form trade unions, the bargaining power of labour increases.
Labour can assume several forms. Digging earth, breaking stones, carrying loads comprise simple labour operations but labour also covers highly qualified and skilled managers, engineers and technicians.
The concept 'Division of Labour' was introduced by Adam Smith in his book 'An Enquiry into The Nature and Causes of Wealth of Nations'.
Division of Labour means dividing the process of production into distinct and several component processes and assigning each component in the hands of a labour or a set of labourers, who are specialists in that particular process.
For example, a tailor stitches a shirt in full. In the case of garment exporters, cutting of cloth, stitching of hands, body, collars, holes for buttons, stitching of buttons, etc., are done independently by different workers. Therefore, they are combining the parts into a whole shirt.
A tailor may stitch a maximum of four shirts a day. In the case of garment exports firm, it may stitch more than 100 shirts a day. Thus, division of labour results in increased production.
It is stated 'Division of Labour is limited by the extent of market'. When markets for a commodity grows from local to national and national to international, producers of that commodity divide and subdivide the processes of its production into finer and finer divisions of labour. Each sub-division is assigned to a particular set of specialist workers. As a result, production rises enormously.
1. Division of labour improves efficiency of labour when labour repeats doing the same tasks.
2. Facilitates the use of machinery in production, resulting in inventions. e.g. More's telegraphic codes.
3. Time and materials are put to the best and most efficient use.
The demerits of Division of Labour are:
1. Repetition of the same task makes labour to feel that the work is monotonous and stale. It kills the humanity in him.
2. Narrow specialisation reduces the possibility of labour to find alternative avenues of employment. This results in increased unemployment.
3. Kills the growth of handicrafts and the worker loses the satisfaction of having made a commodity in full.