CHAPTER 18
CATEGORIES OF INDUSTRY
UNIT 6
Factors of Production
Land = Anything produced by nature used in the production of wealth. Payment = Rent
Labour = the human effort involved in the production of wealth. Payment = wages.
Capital= anything manmade used in the production of wealth. Payment = interest.
Enterprise = having the initiative and taking the risk to produce wealth. Payment = profit or loss.
CATEGORIES OF INDUSTRY (PRIMARY, SECONDARY, TERTIARY)
PRIMARY SECTOR
Extractive Industries (agriculture, fishing, forestry, mining, quarrying, renewable resources
Agriculture
Importance:
 Suitable climate
 Employs 5%
 ‘green image’
 Subsidised by CAP brings money in (chapter 24)
Problems:
 Overproduction has led to ‘decoupling’ and ‘single farm payment’ regardless of production.
 Small unviable. Many getting out
 Weather dependent
 Diseases and growth promoters damage image
New developments:
 Food prices increasing:
 Off farm incomes
 Biofuels
 Food traceability
 Non farming enterprises (horse riding, open farms, b and b)
Fishing
Points:
 Ideal situation but small fleet
 EU trawlers
 Over-fishing and Quotas
 Fish farm and shell fish exports
 Inland fishing and fears of pollution
Forestry
Points:
 Ideal conditions
 Acreage small but growing (Coillte)
 Tax concessions and grants
Mining and Quarrying
Points:
 Lead and Zinc in Navan, Lisheen and Galmoy (all closing soon)
 Ballinaboy in Mayo, natural gas
 Pipeline network in place (Bord Gáis)
 Quarrying for construction of buildings and roads.
 Peat (Bord na Móna)
 Environmental risks
SECONDARY SECTOR (Construction, Manufacturing and Agribusiness)
Construction
Points:
 Bursting of Property Bubble
 Materials made at home
 Immigration
 Sustainable development
Manufacturing
 High tech
 Foreign owned
 Spin off industries
 Risk of going to low cost countries
 Importance of education.
Agribusiness
 Supplying farmers (fertilizer as well as processing farm produce)
 Successful both at home and abroad (Kerry Group)
 Power of supermarket multiples
 Co-ops have become PLCs
Transnational Corporations (Multinationals)
Have a head office in one country but produce in several (Ford)
Advantages:
 Jobs
 Local economy benefits (more money around)
 Spin-offs
 World class training for staff attracts other industries to Ireland
 Improved Balance of Payments
Problems:
 Dependency a problem when they close
 Not rooted in Ireland
 Repatriate profits
 Huge power
Why they set up in Ireland:
 Grants and tax concessions
 IDA
 Low Corporation Profit Tax
 English
 Educated workforce
 Good industrial relations
Indigenous Firms
Irish based and Irish owned. Enterprise Ireland helps with grants and tax concessions, advice and
support, finance for feasibility studies, venture capital.
Advantages:
 Loyal
 Support local community
 Foster entrepreneurship
 Profits stay at home
Problems:
 Small
 Dependent on multinationals
 Wages too high
 Little spent on R and D
TERTIARY SECTOR
Service Industries (banking, insurance, hotels, transport, telecommunications)
State sponsored bodies (IDA, Enterprise Ireland, HSE etc)
Trends:
 Getting bigger relative to the other sectors.
 ICT very big
 Leisure and entertainment bigger
 Irish banks have expanded business abroad
 E Learning
 Childcare