Human Activities are classified as 2 types:-
a. Economic Activities
b. Non-Economic Activities
Economic Activities:-
Activities which are undertaken by people with the objective of earning money are known as economic activities.These activities are concerned with production, exchange of goods and services and distribution of those from producer to ultimate consumers.
The purpose of economics activities should be expectation of money income which is used for further creation of wealth and assets.
Economic activities encompass all the actions and transactions that involve the production, distribution, and consumption of goods and services within an economy. These activities can include various sectors such as agriculture, manufacturing, construction, transportation, communication, retail, finance, and services. Essentially, economic activities involve the creation and exchange of value to fulfill the needs and wants of individuals and businesses. They are fundamental to the functioning of societies, driving employment, income generation, investment, and overall economic growth and development.
Types of Economic Activities:-
1. Business 2. Profession 3. Employment
Business:- At its core, business refers to activities undertaken with the aim of generating profit through the production, distribution, or sale of goods and services. However, the meaning of business extends beyond mere profit-making; it encompasses the entire spectrum of activities related to the creation, delivery, and exchange of value in the marketplace. Business involves strategic planning, resource allocation, risk management, marketing, sales, customer service, and financial management, among other functions. It can take various forms, including sole proprietorship, partnerships, corporations, and cooperatives, and operates within legal, ethical, and social frameworks. Ultimately, the goal of business is to meet the needs and wants of customers while ensuring sustainable growth and profitability.
Profession:- A profession typically refers to a specialised occupation or vocation that requires specific education, training, and expertise in a particular field. Professionals are individuals who have acquired advanced knowledge, skills, and qualifications in their respective areas of expertise. Professions often have established standards, codes of ethics, and regulatory bodies that govern the conduct and practice of their members.
Professions can encompass a wide range of fields, including medicine, law, engineering, accounting, teaching, and many others. These fields often require formal education, such as obtaining a degree or certification, followed by practical experience or internship before individuals can practice independently.
In addition to possessing technical expertise, professionals are expected to uphold high standards of ethics, integrity, and accountability in their work, as they often deal with matters of public trust or provide critical services to individuals and organisations.
Employment:- Employment refers to the relationship between an individual (employee) and an organisation (employer) in which the individual provides labour or services in exchange for compensation, typically in the form of wages or salary. Employment can take various forms, including full-time, part-time, temporary, or contract work.
In the context of the broader economy, employment is a key indicator of economic health and vitality. High levels of employment indicate a strong economy with ample job opportunities, while low employment levels may suggest economic challenges such as recession or structural issues in the labour market.
Employment encompasses a wide range of occupations and industries, spanning from manual labour and skilled trades to professional, managerial, and administrative roles. It plays a crucial role in individuals' livelihoods, providing them with income, financial security, and opportunities for personal and professional development. Additionally, employment contributes to the overall productivity and prosperity of societies by fostering economic growth, consumer spending, and social stability.
Difference between Business, Profession and Employment:
Basis | Business | Profession | Employment |
|---|---|---|---|
| Meaning | Business is an economic activity which includes activities related to the sale and purchase of goods and services on a regular basis with the objective of earning profit. | Profession is an economic activity which includes activities requiring special skills and knowledge in their occupation. | Employment is an economic activity which includes occupation in which individuals work for their superiors with the motive of earning remuneration in return. |
| Mode of establishment | Starts after legal formalities like MOA, AOA, etc., are completed. | It requires membership of a professional body like the Bar Council, etc., and a certificate of practice. | Employment starts after receiving an appointment letter. |
| Qualification | No minimum qualification is required in business. | Formal qualification, expertise, and training from a professional body are essential. | Qualification requirements in employment vary according to the type of job and training prescribed by the employer. |
| Nature of work | It involves providing goods and services to society. | It involves rendering specialized services. | It includes work given by the employer as per the employment contract and the rules of service. |
| Reward | Profit | Professional fees | Salary and wages |
| Capital | It depends on the nature and size of the business. | It requires limited capital. | It does not require any capital. |
| Code of conduct | It does not have any code of conduct. | It consists of a professional code of conduct. | In employment, rules or codes of conduct are set by the employer in the terms and conditions of the service contract. |
| Risk | A business involves high risk. | In profession, there is low risk. | Employment does not involve any risk. |
| Transfer of interest | In business transfer of interest is possible. | In profession one cannot transfer interest. | In employment also transfer of interest is not possible. |
| Example | An individual having a manufacturing plant of automobiles. | Doctors, Lawyers, Teachers, Professors, and Chartered Accountants are the professionals. | Jobs in firms, shops, banks, etc. are considered employment. |