Division of Labour & Worker Specialisation (Cambridge (CIE) IGCSE Economics): Revision Note

Workers can acquire the single skill required relatively quickly

Workers gain recognition and status for performing their skill well

The work can be repetitive and 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

Time spent training new workers is relatively short

Increased output allows firms to generate more sales and profit

Higher labour productivity lowers cost per unit for firms, which makes their goods more competitive internationally (exports)

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 

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

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