Pros & Cons of the Division of Labour & Specialisation
Stakeholder
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Pros
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Cons
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Worker
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- Workers can acquire the single skill required relatively quickly
- Workers gain recognition & status for performing their skill well
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- The work can be repetitive & boring
- There is limited opportunity to gain additional skills
- If the firm replaces labour with capital, the worker may find it difficult to find employment elsewhere due to their limited skill base
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Firm
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- Time spent training new workers is relatively short
- Increased output allows firms to generate more sales & profit
- Higher labour productivity lowers cost/unit for firms, which makes their goods more competitive internationally (exports)
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- Worker productivity can fall due to the boredom/ decreased motivation experienced
- Staff turnover may be high as workers seek new, interesting opportunities elsewhere
- International trade is beneficial for the firms that can compete globally. However, some firms will be unable to compete and will go out of business
- Entire industries may close leading to structural unemployment
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Economy
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- Increased exports can result in economic growth for the nation
- Economic growth usually leads to higher income and a better standard of living
- Income gained from exports can be used to purchase other goods from around the world (imports). This increases the variety of goods available in a country
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- Specialisation may create over-dependency on other countries' resources. This may cause problems if conflict arises (E.g, Europe's reliance on Russian natural gas during the Ukraine crisis)
- Specialisation using a country's own resources will lead to resource depletion. Specialisation increases the rate of resource depletion
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