One of the many famous passages in The Wealth of Nations is the description of how the division of labor makes a pin factory far more productive than it would have been had all the workers performed all of the steps themselves.
One man draws out the wire, another straights it, a third cuts it, a fourth points it, a fifth grinds it at the top for receiving the head; to make the head requires two or three distinct operations; to put it on, is a peculiar business, to whiten the pins is another; it is even a trade by itself to put them into the paper; and the important business of making a pin is, in this manner, divided into about eighteen distinct operations… Those ten persons, therefore, could make among them upwards of forty-eight thousand pins in a day. Each person, therefore, making a tenth part of forty-eight thousand pins, might be considered as making four thousand eight hundred pins in a day. But if they had all wrought separately and independently, and without any of them having been educated to this peculiar business, they certainly could not each of them have made twenty, perhaps not one pin in a day; that is, certainly, not the two hundred and fortieth, perhaps not the four thousand eight hundredth part of what they are at present capable of performing, in consequence of a proper division and combination of their different operations.
My recent bedtime reading has been the Mabinogion, a late medieval collection of older Welsh stories. Though its purpose is not economic education, the Third Branch has a reference to greater productivity through the division of labor. It describes the character Manawydan’s attempt to earn a living in a new town as a shoemaker, assisted by his friend Pryderi:
As long as it could be obtained from him, no shoe nor boot nor anything could be sold by a shoemaker in the whole of the township. As for the [other] shoemakers, they realised their profits were failing: for just as Manawydan crafted his work, so Pryderi stitched.
The extent of the market and technology were both very limited in the period when those stories were told (relative to today). The division of labor was therefore far less advanced. But it did happen, and judging by the stories that endured, people noticed even if they didn’t yet have the economic theory to appreciate it.