Evolution of Industrial Relations

Submitted by:Saima

Abhilasha Sunakshi

Arushi

To understand the emergence of industrial relations, it is necessary to study the process of evolution of industry

The evolution of industry has been quite gradual. There was a time in the history when there used to be no

industrial activity. During hunting stage, man lived all by himself After this man entered into pastoral stage under which he

started domesticating animal to have an assured supply of milk, meat &skin.

Gradually, man discovered a new use to which land could be put and entered in agricultural stage.

He began to cultivate and grow food, whereas some people who didn’t have any work were offered to work in the field of others.

Evolution

We can classify the stages in the evolution of industry as follows:

Primitive stageAgrarian economy stageHandicrafts stageGuild systemPutting out(or Domestic) system Industrial revolution

Stages in Evolution of Industry

The first three stages represents Pre- machine age. Machine was started after industrial revolution in

England which took place between 1760 A.D and 1820 A.D.

Industrial relations has its roots in the industrial revolution which created the modern employment relationship by spawning free labour markets and large-scale industrial organizations with thousands of wage workers. As society wrestled with these massive economic and social changes, labour problems arose. Low wages, long working hours, monotonous and dangerous work, and abusive supervisory practices led to high employee turnover, violent strikes, and the threat of social instability.

At this stage families were self-sufficient as their need were limited. Hence there was no problem of exchange of goods.

Division of the labour was restricted only to the family level.

Men devoted their time to activities like hunting, fishing and making of weapons, and women engaged themselves in cooking, bringing up the children, agriculture and domestication of animals.

In short, all the activities of the family were carried on to produce or procure products for family consumptions.

As every family was able to satisfy its needs, there was no question of exchange of goods

Primitive stage

In the course of time, some families started keeping the animals rather than killing them which led to domestication of animals.

Animals were treated as a form of wealth which could be exchanged for other products required by the family.

This gave birth to the BARTER ECONOMY.

Barter economy may be defined as the direct exchange of one economy commodity for another commodity.

It was developed because of the increase in the number of human wants and inability of a family to produce all the things required by it.

The exchange was direct and without any common medium.

Every person used to exchange the surplus goods with the other person for the required goods.

The main difficulty of this system was the lack of double coincidence of wants and a common measure of value. Therefore, the exchange was restricted only to the goods in which some families were surplus and other families were deficient.

Agriculture became the primary source of maintenance during this stage and tribes settled down permanently at some places and began to sow seeds and rear cattle on the land which they shared in common

The division of labour confined to the division of work between men and women of the tribe.

Agrarian Economy stage

With the rise of private ownership of the property inland and cattle, the tribe split up in the families and lead to variation in human wants.

Families were not self sufficient. Moreover they concentrated on occupation

bother than agriculture This led to exchange of goods for goods to satisfy

the needs of various families and the establishment of village economy.

Being now a self sufficient economy they also started using hired labour.

Later on traders came into existence who purchased the surplus products of different families and sold them to those requiring these products.

The difference in purchase and sale price was their profit.

Emergence of traders led to specialisation in different fields by different families.

It was no longer necessary to produce everything a family needed for self-consumption.

Under this stage, artisan living in village produced the products for the local population and got in exchange various things from customers.

There was hardly any machinery so craftsman used simple hand tools and manual skills for producing the goods.

There was no division of labour thus the organization of industry was quite simple

The craftsman was responsible for assembling various raw materials and selling the goods produced.

Handicraft stage

Two types of guilds initiated, namely MERCHANT GUILD and CRAFT GUILD.

A merchant guild was association of merchants engaged in trade in a particular locality whose purpose was to enforce equality of opportunity for the members of the guild, to protect their interest, to avoid competition among the members and also to regulate the conduct of its members by prohibiting unfair practices.

Guild stage

A craft guild, on the other hand was an association of the skilled artisans engaged in the same occupation. Thus there were several guilds in a town.

They regulated entry to the craft, prescribed standards of workmanship and regulated the conduct of the members.

The guild system began to decline by the end of 15th century due to narrow attitude of the guilds and the increasing rivalry among their members.

At this stage, the intermediary between the products and consumers of goods came to play an important role.

The entrepreneur gave out work to the artisans who worked in their homes, still they owned the means of production.

The entrepreneurs came at regular intervals, collected the goods and paid for them to the artisans.

Artisans faced difficulty when the scale of production increased and there were need for new tools of production.

Putting out System

Entrepreneurs started providing raw materials and tools to the artisan who produced good and received wages on piece wage basis. That is why this stage is called PUTTING OUT SYSTEM.

During 18th century entrepreneurs followed the practice of employing artisans, providing them the raw materials and equipments, inspection of quality of the product and finding a market for his product.

Industrial revolution during the later part of the 18th century and earlier part of the 19th century had a vital influence on the development of industry and commerce.

It changed radically the techniques of production and had an important impact on the life of mankind.

Industrial revolution was the result of the invention of many English scientists during 1760 to 1820.

The need for invention arose because of the increase in the demand of the product due to widening of markets followed by the geographical discoveries of the late 15th and 16th centuries.

Industrial Revolution

It was beyond the capacity of the industry using labour intensive techniques to meet the increasing demand.

The inventors in England had set for themselves the task of finding ways and means to remove the hindrances in production.

James Hargreaves made “SPINNING GENNY” in 1764 and Richard Arkwright introduced “WATER FRAME” in 1799

Thereafter many mechanical inventions came in quick succession such as “Mule Spinner” by Crompton, and “Power-Loom” by Cartwright.

The invention of steam engine enabled man to drive the machines by power.