Life Before the Industrial Revolution
Most people lived in the country before the Industrial Revolution. Due to the limited development of farming methods, it was necessary for the majority of the people to live in a rural countryside area in order to produce enough food for the population. Most families farmed and live on small plots of land controlled by large land owners - often members of nobility.
Roads were poorly maintained and sometimes dangerous; so people rarely left their home villages. Few people ever left the area of their birth! News of events in the outside world arrived slowly and sporadically.
The vast majority of the population worked in the fields, however farming was not a year-round employable activity. The peasant farmers were quite busy during times of planting and harvesting; but at other times they were free to do other work - specifically working for clothing merchants. These clothing merchants would provide families with wool or cotton. For a fixed price, the families would spin yarn on a spinning wheel or using a hand-operated loom. Because all of this work was being done in the family’s cottage home, this era was called the "cottage industry."
Weaving cloth was difficult and tedious, but provided valuable income for many families. It was convenient work: the work could be performed at home, whenever the worker wanted. Children were able to work with their parents, and tended to become quite skilled at a young age.
Merchants made out well because they paid very little for the cloth that was produced by the families; thus able to sell it for a large profit. The downside though, was that the merchants encountered inconsistent quality, and they had no way to supervise the work being done - especially when families had the opportunity to make money other ways (ex. farming). The merchants needed a way to ensure the product was delivered on time and had the desire to increase production.
In summary: prior to the Industrial Revolution, most people were involved in agriculture and the "cottage industry."