How did this term get to be used in the context of work? Usually it’s applied to jobs involving manual labour, as opposed to desk jobs, yet there isn’t any “honesty” (or dishonesty) implied for either of those types of jobs.
Honest, as opposed to lawyers. 
There are, of course, jobs where dishonesty can sometimes reap advantage; telemarketing and used car sales, for example (which is not to say that anyone employed in those professions is automatically dishonest, only that dishonesty can be used to advantage in those jobs).
but I think in the context of an honest day’s work, ‘honest’ just means simple, virtuous and respectable.
I never understood the term to mean just physical labor. I thought it could just be any kind of non-illicit work to which you earnestly apply yourself
I get the impression that, early in the history of the US, some people believed that there was something dishonest about what we today would call “white-collar” work, so that manual labor was somehow more respectable.
“Honest” hasn’t always been a simple antonym of “deceitful.”
Its earliest sense is more akin to “respectable.”
“Honest labour” is a well-worn phrase and has been for centuries. The contrast isn’t with academics or professionals; it’s with idlers.
Also, “labour” has only lately become more closely associated with manual work.
The distinction is fairly old, of course. In the eighteenth century, John Locke wrote “Let the gent and scholar spend nine of the twelve [recommended hours of productive work per day] on his mind and the other three in some honest labour, and the man of manual labour nine in work and three in knowledge.”
Note that there is no deprecation of scholarly or refined work implied – only that it’s important that you do something.
There are similar phrases; one that springs to mind is "it’s just good, honest dirt’ - usually referring to dirt on a person’s hands or face, resulting from diligent toil.
I believe that the orgin is from the phrase a honest days pay for an honest days work. ( the other way around if you prefer.)
You work hard for 8 hours and get paid for 8. Would be honest.
If you only work 6 and skate for 2 and still get paid 8 that is not honest. You are cheating the employer
Likewise if you work for 8 and get paid for 6 that also is not honest. The employer is cheating you.
This site says it is an adoption of a phrase used by the American Federation of Labor. Which seems to agree with what I wrote above. However my Google-fu is weak and I cannot seem to verify this.
Being a labor union they would tend to deal more with blue collar workers (back then) then white collar workers. So this would explain the shunning of office workers.
You make 8 widgets, you get 8 shillings. Think of it this way, you go to a factory inquiring about a job. The foreman tells you, “I’ll hire you. Now, you be a good lad. You make a widget and I’ll give you a shilling.”
It’s good, honest work. It’s a measure of productivity.
What’s the productivity of the factory: the average worker makes 7.2 widgets per day. What the productivity of the office: uh, well, the average worker makes…no, um, the average worker copies - how do you measure the productivity of an office?!
From my experience, there is a sentiment among many that those who do the manual labor are the real “workers”, while the workers’ superiors are reaping all the rewards from the manual laborers. Amongst those who believe this to be true, many take a stance of “Although I’m being taken advantage of by those dishonest administators, I have a personal pride they can never have, because I know that I work for the money I make.” I might guess that the phrase “honest work” might be tied in with this perception. IMHO, I think that perception is foolish.
I have the impression that it was work which produced something at the end of the day, as opposed to a desk job, where the impression could be gained that you’re paid to sit behind a desk shuffling papers - i.e. not really “doing” anything -> “dishonest” work
Grim
I’ve always thought it was a response to those to “look down” on manuel laborers, and think the work they do is somehow “better” than physical labor. It’s pointing out the manual work is also “honest” and better to be a day laborer than a thief or on the dole.