Labour: Meaning, Kinds and Importance | Economics

Let us make an in-depth study of Labour in Economics:- 1. Meaning of Labour 2. Definition of Labour 3. Kinds 4. Importance.

Meaning of Labour:

In simple meaning by ‘Labour’ we mean the work done by hard manual labour mostly work done by unskilled worker.

But in Economics, the term labour mean manual labour. It includes mental work also.

In other-words we can say that Labour includes both physical and mental work undertaken for some monetary reward.

In this way, workers working in factories, services of doctors, advocates, officers and teachers are all included in labour. Any physical or mental work which is not undertaken for getting income, but simply to attain pleasure or happiness, is not labour.

For example:

The work of a gardener in the garden is called labour because he gets income for it. But if the same work is done by him in his home garden, it will not be called labour, as he is not paid for that work. Further, if a mother brings up her child, a teacher teaches his son and a doctor treats his wife, these activities are not considered ‘Labour’ in economics. It is because of the fact that these are not done to earn income.

Definition of Labour:

1. According to Prof. Marshall – “Any exertion of mind or body undergone partly or wholly with a view to earning some good other than the pleasure derived directly from the work.”

2. According to Prof. Jevons – “Labour is any exertion of mind or body undertaken partly or wholly with a view to some good other than the pleasure derived directly from the work.”

3. As S. E. Thomas has said – “Labour connotes all human efforts of body or mind which are undertaken in the expectation of reward.”

4. According to Waugh – “…………………… we define labour as human efforts used in production.”

Therefore, important facts regarding Labour are:

(i) Only the work of man is included under Labour.

(ii) The physical and mental work undertaken for some monetary reward is included under Labour.

(iii) Any work done for entertainment or for self-satisfaction is not included under Labour in economics.

(iv) In Economics Labour has no relation with morality.

(v) Any work done by animal or bird is not Labour in Economics.

Kinds of Labour:

Labour can be classified under the following heads:

1. Physical and Mental Labour.

2. Skilled and Unskilled Labour.

3. Productive and Unproductive Labour.

1. Physical and Mental Labour:

Such work in which physical labour and physical strength is more important in comparison to mental labour is called physical labour. For example—The work of Rickshaw Puller, workers working in factory, porter who carries luggage on the platform.

But mental Labour is that in which brain is applied or mental fatigue is more in comparison to physical fatigue, For example—The work of an advocate, teacher, doctor, chartered accountant etc. For better performance of work mental and physical labour is essential.

2. Skilled and Unskilled Labour:

Skilled Labour is that in which special knowledge, learning, training and efficiency is required in performing the work. For example—The Labour of engineer, doctor, teacher and a scientist has been called as skilled Labour.

While the work in which special knowledge, training or learning is not required is known as unskilled labour. For example—The work of rickshaw puller, porter carrying luggage on platform is called unskilled. The remuneration of skilled worker is normally higher than that of unskilled worker.

3. Productive and Unproductive Labour:

Productive Labour is that labour which adds net value to the product. While unproductive labour is that which does not add net value. In other-words we can say that “Labour producing material goods are productive and Labour producing perishable goods including services of servants, teachers, doctors, lawyers etc. are unproductive.”

But according to Prof. Marshall all labour is productive. He saw-“no distinction in the work of the baker who provides bread for a family and that of the cook who prepares rice or boiled potatoes”. Modern economists following Marshall regard all Labour whether material or non-material or services as productive.

Only that Labour is considered unproductive which is performed by anti-social persons such as pickpockets, thieves, dacoits etc. But Labour used in constructing building, a dam etc. is productive because the workers worked on them and receives wages.

In this connection Prof. Robbins has written “Whether Labour is productive or unproductive does not depend upon its physical or mental nature of work. Rather it depends upon its relative scarcity in relation to its demand. All kinds of Labour which has a demand and receives a wage is regarded as productive.”

Importance of Labour in Production:

Labour is the fundamental and active factor of production Labour has important contribution to the production of commodities. Labour is the exertion of mind and body undertaken with a view to some goods other than the pleasure directly derived from the work. Like a commodity, Labour cannot be stored and withdrawn from the market for a favourable time if the wage offered in low.

Further, Labour is inseparable from labourer and has to be be delivered personally, working conditions or environment are of great importance. If the place of work is congenial and the management is kind hearted, even a lower wage can be acceptable. Labour has a weak bargaining power, therefore, the employer has an upper hand in Labour transactions and the wage given is lower than it is due.

The supply of Labour cannot quickly adjust to the change in demand. The wages sometimes rule higher and at other times lower than need be. As the Labour has no calculable cost of production, it has to be satisfied with the wage it can receive or it receives.

Therefore, Karl Marx has said—”Capital is the collective shape of Labour performed in the past. Land which has been made for productive purposes is the important effort of Labour”. Hence, we cannot ignore the importance of Labour in Economics.