World Geography 3202
Unit 5: Secondary and Tertiary
Activities
Chapter 13
PATTERNS IN
MANUFACTURING
Introduction to Manufacturing
Three Sectors of the Economy
1. Primary
– Involves the collection or extraction of raw materials from
the earth. Farming, fishing, mining, forestry are the classic
parts or examples of the primary economy.
– The farmer takes plants from the land, the forester takes
trees from the forest, the fisher takes fish from the ocean
and the miner takes ore from the ground.
– All involve collecting natural resources.
2. Secondary
– Involves processing or manufacturing raw
materials into products for people to buy. All the
activities start with a raw material and convert it
to a product for sale.
– It is often referred to as the “manufacturing or
processing” sector.
– There are a multitude of examples for secondary
processing.
– Sometimes referred to as “Value adding”
(Example: the tree would be much less expensive
to buy than the lumber. The processing
(sawmilling) to make lumber has added value).
3. Tertiary Economic Activity
– It involves providing service to people. It is often
referred to as the service industry. Does not deal
with raw materials
– Nurses, doctors, lawyers, teachers, waitresses,
hairdressers, sales people all provide services for
other people. Tourism is an important part of the
tertiary sector.
Manufacturing: A Systems Approach
1. Inputs: materials & factors that go into
making a product (Examples: raw materials,
electricity, buildings, land, labor, capital,
machinery).
• There are two types of inputs:
1. Human: Made by people (i.e. steel)
2. Natural: Nature (i.e. sunshine)
2. Manufacturing Processes: 3 types of processes
that change a raw material to a usable form:
1. Conditioning: minimal change to a resource
(Example: logs into lumber; fish into fillets).
2. Analytical: one resource converted to a number of
different products (Example: cow into leather, milk &
cheese).
• 3. Synthetic: several resources are combined
to make one resource(Example: light bulb has
glass, tungsten, nitrogen and aluminum).
3. Outputs: it is the finished product from a
manufacturing process. For example, the
output from the fish plant is fish sticks or
frozen fish fillets.
Types of Manufacturing
1. Labour Intensive vs. Capital Intensive (Process)
– “Labor intensive”: requires a lot of person hours to
produce the product (Example: jewelry making).
– “Capital intensive”: requires a lot of expensive equipment
to make the product (Example: automotive plant).
– Some manufacturing businesses might be more
difficult to classify because they require large
quantities of both capital and labour.
Labour versus Capital
2. Heavy vs. Light Industry (Output)
– Manufacturing businesses can be classified based
on the output.
– Heavy industry: produces big expensive products
for other industry (Ex. Ship yard, tractor
production).
– Light Industry: produces products for consumers
(Ex. Pop, clothing manufacturing).
• Some manufacturing businesses might be more
difficult to classify because they produce items that
might be used by business or by private people.
Heavy Industry or Light?
Location of Industries
1. Site/Physical Cost Factors
– Three major factors of site (physical location)
a) Proximity to raw material: Heavier & bulkier the
raw material the closer the industry will be
located to reduce transportation costs.
• “Resource Oriented Industry”
– industries located close to the resource because it is to
heavy/bulky to transport;
– communities frequently spring up around resource
industries. Labrador City, Churchill Falls, Grand Falls-Windsor
and Bonavista are good examples.
b) Land: price, level, good drainage, dense wellsettled soil
c) Energy: not as important a factor today due to
our ability to transport power long distances.
2. Human-based Cost Factors
– Market Oriented Industry
•
Industries that are located close to the market
because the product is expensive to transport. The
resources are not bulky or expensive to
transport. The soft drink industry is a good example.
– Agglomerating Tendency
• Agglomerating tendency refers to the tendency for
factories producing related products to locate close to
each other for mutual benefit (Ex. Auto plants & tire
factories).
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Industrial Parks
• Industrial parks provide many advantages for a
business. Existing infrastructure of roads, on and
off ramps to highways, large building lots, sewer,
ample electricity, and close location to related
industries make industrial parks attractive for
manufacturing businesses.
– Labour force characteristics that attract business
• Wages: lower wages in some developing countries like Mexico, and
the Philippines attract manufacturers
• Training: highly skilled labourers can attract businesses that
require welders, mechanics, carpenters etc.
• Benefits (EI, Pensions etc): lower costs of employment insurance,
pensions , etc. can attract business just as easily as low wages.
• Availability: a high unemployment rate might attract business,
especially if large numbers of workers are required.
3. Government Influence
– Subsidies: affect the location of industry. Subsidies
are financial aid from government
• Subsidies allow businesses to locate farther from the
resource.
• Subsidies allow governments to encourage industry in rural
areas.
Examples:
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ice breakers in Botwood;
roads in Labrador;
cost of coastal transportation in Labrador;
cost of crossing the Gulf.
– Tax breaks affect the location of Industry.
• Provinces like Newfoundland have attempted to attract
business by offering tax breaks. The company obtains a
financial break while the province gets the advantage
of putting people to work.
4. Industry Location; The Global Picture
– Look at figure 13.6 on page 223 of your text book.
– The highly industrialized areas on the earth's
surface are concentrated in 4 definite regions:
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North America
Western Europe
Japan
Australia
– Do you see any other patterns?
Activity
– Read the case study "Human and physical factors
in Japan's Car Industry" on pages 227-228 and
complete questions 18 & 19 on page 228 of your
text book.
Industry & Environmental Threats
Industrial Waste
• Industry has waste out put as well as product
output. Three of the many types of waste are
outlined below.
– Green house gasses; ex. Carbon dioxide,
Chlorofluorocarbons & methane. Causes global
warming & associated problems.
– Acid Rain; ex. Sulfur & nitrogen. Decreases soil
fertility, kills fish, corrodes buildings
– CFC’s (chlorofluorocarbons); ex. Refrigerants & sprays.
Breaks down ozone which filters harmful cancer
causing UV rays.
• Industrial wastes are obviously mostly related
to areas of heavy industry. However, when we
look at the maps on p. 238 and
realize prevailing winds play a role we can see
that pollution does not recognize political or
economic boundaries.
Role of Government and Interest groups
Remember: It is the extreme views that define
the middle.
• Interest groups often play the extremist. They
raise valid points of concern and argue them
vehemently.
• Government has the role of balancing
environmental concerns & encouraging
economic development.
Averting environmental threats posed industry.
• Analyzing the acid rain map p. 238 and the
industrialized country map p. 223 and the
prevailing winds map p. 64 you can see that
prevailing winds are transporting acid rain from
industrialized areas and depositing it in locations
down wind from the industrialized area. It is
important to note that industrialized areas as well
as those areas down wind from industrialized
areas are affected.
• Any solution to industry related problems will
have to be dealt with by cooperation and
consultation between different nations. The
major environmental summits that have been
held in recent years are examples of that. The
recent Kyoto summit and the summit held in
Rio de Janeiro several years ago attempted to
get countries to reduce their carbon dioxide
emissions.
• Solutions to solving the acid rain problem
include:
– government regulation to reduce sulfur &
nitrogen emission;
– development of sulfur filtering equipment;
– tax breaks for companies if they reduce pollution
output;
– meetings and consultation between business,
environmentalists and government to decide on a
plan of action.
Moral Issues and Industry
• There are many social/moral issues associated with
manufacturing operations. Examples include child labour,
safety of workers and a Company’s responsibility to be
environmentally friendly.
• Business drives the economy and provides us with our high
standard of living here in the western world. The question
we have to keep asking ourselves is "are industries acting
within the moral parameters of our society".
• In Canada and most well developed nations there are strict
regulations about safety, waste emissions, age of workers,
and corporate responsibility. In some developing nations
the regulations might not be in place or they might be
relaxed in the hope of stimulating business instead of
inhibiting it.
Activity
– "When Children Do Not Play" on pages 235-236 of
your text book.
Kyoto and Environmental Summits
Activity
• Using your favorite search engine find some web sites that deal
with the Kyoto summit. Skim several sites. Don't spend more than
30 minutes. Do NOT get caught up and read through an entire site.
Remember different stakeholders have different views and reading
through only one site will give you a slanted view.
• Answer the following questions on line in your discussion forum.
You may not find all of the answers but you should be able to
address the central issues of the questions
– What environmental issues did the Kyoto summit address?
– Were all countries represented at the summit?
– Even though this was a summit to address environmental issues did
environmentalists have any concerns?
– Will the problems addressed be solved quickly?
Tertiary Activity
Tertiary Activity
– Service industry.
– Providing services for people
(Ex. Doctor, lawyer, waitress, tourism industry,
mechanic, teacher, etc.)
Public vs. Private Tertiary activity.
– Private service industry is run by private business
and requires that a profit be made from the
service. Ex. Mechanics, Lawyers, Tourism.
– The four types of tertiary activity are:
• Distributive activities: involves the transportation and
sale of all products from manufacturer to consumer. ex.
truck driver, warehouse manager, sales person
• Financial Activity: involves banks, insurance companies,
financial advising companies, and trust companies.
• Personal Service: involves a wide range of services from legal
services, to food services, to entertainment and counselling
services.
• Government service: Public service industry is operated by
Government and is not for profit. On the contrary it cost tax
payers money. Ex. Education, health care, mail, water, sewer,
roads. Hence the term ? public servant?
– It is important to note that many careers in the
tertiary sector can not be classified as public or
private. A teacher can work in the public school
system which is public service or s/he can work for a
private college which is private service.
Tertiary Activity
• Proximity & price are two key factors that
determine the location of service industries.
– Location: services must be located close to a large
enough market to produce DEMAND.
– Viability: services are only viable as businesses if
the demand is high enough & the price is
reasonable.
• Service Availability vs. Population Size.
– Larger populations support a wider range of
services.
– Consider: Health services, Education, recreation
facilities, shopping facilities, hotels, restaurants
and you will see that the range of services
available is directly related to community size.
Tourism
Tourism is one of the fastest growing sectors of
the economy. It is also one of the most
profitable. If your country happens to be
located in a sunny area or to have good ski
slopes or to have cultural attractions then
people will flock there and spend
money.
Furthermore from a country's
perspective international tourism is new money
coming to the country.
International tourism has increased dramatically for 6
reasons:
– people have increased leisure time due to available
technologies;
– retired people have secure incomes and are able to travel;
– people have increased discretionary spending money;
– travel has become easier and less expensive;
– travel agencies have packaged attractive "all expenses
paid" trips;
– advertising has been effective using attractive & exotic
pictures.
Travel agents see that people are usually looking
for one of three different kinds of vacations:
– Climate oriented (skiing & sun bathing are at
opposite extremes but both rely on climate)
– Landscape oriented (some people like to view the
sites)
– Culture oriented (cultural land marks are of
interest to people ex. Athens)
Activity
Assigned Readings
• "International Tourism in the Tertiary Sector" p.
245-246
Assigned Activities
• Complete questions # 11-14 on page 246 of your
text book.
• Case Study "Costa Del Sol" p. 247-248 complete
questions #15-18
Quaternary Activity
The quaternary sector of the economy is a
specialized part of the Tertiary Sector.
– QUATERNARY activity refers to activities which
involve the collection, recoding, arranging,
storage, retrieval, exchange, and dissemination of
information. Computers, Cell Phones, E-mail, and
the WWW are some of the examples of new
information technology which drives the
quaternary sector.
Factors Affecting Location of Quaternary
Activity
• People & Infrastructure:
– Populations of people concentrated in an area
make the information sector viable. Historically,
information technology like cable TV, telephones,
and Radio flourished in areas where there was a
population large enough to support them.
– Infrastructure is required for the communication
of information. The infrastructure has been closely
linked to populated areas. Lesser developed
nations currently do not have much access.
However, lesser developed nations are not tied to
the old and outdated infrastructure. This might be
the time for lesser developed nations to build
infrastructure and increase their share of the
information technology market.
Factors Affecting Mass Communications
Patterns.
• In the telesphere of global communications
there are islands and continents of activity
and there are deserts or areas where there is
no activity because there is no connectivity.
The areas of connectivity are closely
associated with development and you will see
that in your readings and activity.
Mass Communication Affects Workplace
Location.
• As more and more people work in the
information sector we may see a trend
towards reducing urbanization. People would
not be tied to an office building if they could
work at home. Maybe they could work at
home on the country farm and submit work
electronically.
• Businesses need not be located physically
near other businesses as we saw with the
agglomerating tendency of the manufacturing
sector.
• If Infrastructure improves to the point it
overcomes distances information technology
will be a new source of employment and
economic activity in rural depressed regions.
Assigned activities
– Read "The Quaternary Sector and The Information
Age" p. 249
– Complete questions #19-21
Tertiary & Quaternary Activity Trends
• Economists recognize that the tertiary industry has
expanded significantly in the last 100 years. The
tertiary sector in Canada has grown from 36% of GNP 73% of GNP over the last 100 years.
• The entire tertiary sector is growing and is becoming a
much larger part of the economy of developed nations.
As the secondary sector of the economy grew there
were more people working in urban areas as
manufacturers. The concentration of people meant
there was more need for services. Service industries
grow in turn. The people working in the tertiary
industry need services too so the growth of the service
industry continues.
International Tourism
• In the last quarter of the twentieth century International tourism
increased 12.5%. There are several reasons for this which are
outlined below.
• More leisure time since WWII:
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More retired people because of aging population
Younger retirement age. It did average 65 now it is closer to 55.
The average holiday time has increased from 2 weeks to 4 weeks
More money for leisure & recreation since WWII.
Wages have increased giving people more disposable income
Travel time and travel costs have decreased
Travel agencies are offering all inclusive packages which attract people
Appealing advertising campaigns by travel agencies.
• Travel agencies and related tourism industries have both
been a cause and a result of the increased interest in
tourism.
• Tourists tend to be looking for any one or combination of
three destination sites.
– Climate-oriented Sites:
• warm climates, sunbathing and swimming attract some tourists from
colder regions.
• Abundant snow and good skiing conditions attract those avid skiers
and snowmobilers
– Landscape-oriented Sites:
• some tourists are attracted by site seeing opportunities.
– Culture-oriented Sites
• Some tourists are attracted by historic sites like Athens and Jerusalem.
Assigned activities
– Read "Tertiary Activity and Economic
Development" p. 241-244
– Complete questions #5-8 p. 244
– Assignment: "Quaternary Trends"
Standard of Living Indicators
Economic Indicators
• Economists, sociologists, cultural geographers and all
social scientists use "indicators" to give some degree of
measure to the concept of development.
• There seems to be two aspects to development,
economic (financial) and social (human). Social
scientists have developed economic indicators and
social indicators. There is some debate over which
indicators are a better measure of development. It is
very likely that a variety of indicators is the best way to
determine the level of economic development.
Economic Indicators
• There are a variety of economic indicators
which can provide a measure of the degree of
development in a country. Two of these
indicators are; 1) Employment Structure, and
2) GNP per Capita.
Employment Structure
• Economists have recognized that those countries
that have become "developed" have been able to
move their economy beyond the primary sector
to the secondary sector which in turn grows the
tertiary sector.
• When economists calculate the percentage of
people working in each economic sector the
statistic created is known as the employment
structure.
Employment Structure for Country "X"
Primary sector
60%
Secondary sector
15%
Tertiary sector
25%
• Economists would look at country X and realize that it
is not a developed country. It might be developing but
a developed country would have a great majority of its
workers in the secondary and tertiary sectors of the
economy.
Employment Structure for Country Y
Primary sector
5%
Secondary sector
25%
Tertiary sector
70%
• Economists would classify country Y as a
developed country. It has a great majority of its
workers in the secondary and tertiary sectors of
the economy.
GNP per Capita
• GNP refers to the total value of the production
of goods and services in a nation measured
over a year, together with any money earned
from investment abroad, less the income
earned with in the nation by non-nationals.
The GNP per capita takes that dollar value and
divides it by the population of the country.
• It is very likely that country X would have a much higher GNP per
Capita.
• Economists do recognize there is a major flaw in this measure as a
measure of "Standard of Living." This measure is an average which
assumes that the wealth in the country is evenly spread. This is
often not the case. If one or two families in the country are very
rich and control most of the money then many of the people could
be living in poverty even though the GNP per capita is high.
• Look at Figure 13.12 on page 231 of your text. This map shows you
a comparison of countries based on GNP per capita. The disparity
between countries should reveal a familiar pattern.
• NOTE: GNP and GNP per capita are usually expressed in U.S. Dollars.
Assigned Readings & Activities
– "Employment Structures and Development
Indicators" on page 230-233 of your text book and
complete questions #22-28
– "Tertiary Activity & Economic Development" on
Pages 241-243 of your text book.
Defining Development
The level of development in a country refers to two type of
development, economic development and social development.
• Economic development refers to how well the economy is doing
and how much money people have at their disposal.
• Social development is often closely tied to economic development
but refers to more human indicators of well being such as life
expectancy, infant mortality rate, literacy rate, availability of
communications.
Generally speaking, people in more developed countries are better off
and have an easier life than people in lesser developed
nations. Economists and sociologists use the term "standard of Living"
to describe how well off people are. Standard of living equates to
quality of life.
• The level of development among nations is far
from equal. Some countries have a very high
standard of living with long life expectancy,
equal rights, high average wages, strong
economies, great health care and high literacy
rates while other countries have a short life
expectancy, fierce discrimination against
woman, very low wages, faltering economies,
little health care and very low literacy rates.
• The United Nations recognizes the disparity and has set
forth eight "millennium goals" to reduce the disparity
among nations.
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Eradicate extreme poverty and hunger
Achieve universal primary education
Promote gender equality and empower women
Reduce child mortality
Improve maternal health
Combat HIV/AIDS, malaria and other diseases
Ensure environmental sustainability
Develop
a
global
partnership
for
development
• By the year 2015 all 189 United Nations
Member States have pledged to meet the
above goals.
Assigned Activity
• Assignment – “Developing Nations"