Secondary sector of the economy

Economic sectors
Three-sector hypothesis
Primary sector: raw materials Secondary sector: manufacturing Tertiary sector: services
Theorists
Colin Clark · Jean Fourastié
Additional sectors
Quaternary sector · Quinary sector
Sectors by ownership
Business sector · Private sector · Public sector · Voluntary sector

The secondary sector of the economy or industrial sector includes those economic sectors that create a finished, tangible product: production and construction.

Function

This sector generally takes the output of the primary sector and manufactures finished goods. These products are then either exported or sold to domestic consumers and to places where they are suitable for use by other businesses. This sector is often divided into light industry and heavy industry. Many of these industries consume large quantities of energy and require factories and machinery to convert the raw materials into goods and products. They also produce waste materials and waste heat that may pose environmental problems or cause pollution.

. . . .

Some economists contrast wealth-producing sectors in an economy such as manufacturing with the service sector which tends to be wealth-consuming. Examples of service may include retail, insurance, and government. These economists contend that an economy begins to decline as its wealth-producing sector shrinks. Manufacturing is an important activity to promote economic growth and development. Nations that export manufactured products tend to generate higher marginal GDP growth, which supports higher incomes and marginal tax revenue needed to fund the quality-of-life initiatives such as health care and infrastructure in the economy. The field is an important source for engineering job opportunities. Among developed countries, it is an important source of well-paying jobs for the middle class to facilitate greater social mobility for successive generations of the economy.

List of countries by industrial output

Main article: List of countries by GDP sector composition

Industrial output in 2011 (Nominal)

Rank	Country	Output in billions of US$	Composition of GDP (%)	% of Global Industry
—	World	21,913.656	31.3%	100.0%
—	European Union	4,508.012	25.1%	20.6%
1	United States	3,329.324	22.1%	15.2%
2	China	3,291.569	47.1%	15.0%
3	Japan	1,405.292	24.0%	6.4%
4	Germany	1,019.643	28.1%	4.7%
5	Russia	697.414	37.0%	3.2%
6	Brazil	677.322	26.9%	3.1%
7	Italy	565.918	25.2%	2.6%
8	United Kingdom	535.891	21.6%	2.4%
9	France	519.529	18.5%	2.4%
10	India	484.809	26.3%	2.2%
11	Canada	476.602	27.1%	2.2%
12	South Korea	458.556	39.4%	2.1%
13	Spain	396.412	25.8%	1.8%
14	Mexico	388.751	32.8%	1.8%
15	Australia	385.895	25.6%	1.8%
16	Indonesia	383.794	46.0%	1.8%
17	Saudi Arabia	378.759	67.6%	1.7%
18	United Arab Emirates	212.700	59.4%	1.0%
19	Netherlands	207.704	24.2%	0.9%
20	Turkey	205.273	26.9%	0.9%
-	Remaining Countries	5,872.860		26.8%

Industrial output in 2011 (PPP)

Rank	Country	Output in billions of US$	Composition of GDP (%)	% of Global Industry
—	World	24,680.946	31.3%	100.0%
1	China	5,329.942	47.1%	21.6%
—	European Union	3,962.935	25.1%	16.1%
2	United States	3,329.324	22.1%	13.5%
3	India	1,175.548	26.3%	4.8%
4	Japan	1,054.944	24.0%	4.3%
5	Russia	879.294	37.0%	3.6%
6	Germany	868.141	28.1%	3.5%
7	Brazil	621.158	26.9%	2.5%
8	South Korea	613.104	39.4%	2.5%
9	Mexico	544.157	32.8%	2.2%
10	Indonesia	516.413	46.0%	2.1%
11	United Kingdom	486.774	21.6%	2.0%
12	Italy	460.807	25.2%	1.9%
13	Saudi Arabia	458.100	67.6%	1.9%
14	France	410.102	18.5%	1.7%
15	Iran	377.676	40.6%	1.5%
16	Canada	376.992	27.1%	1.5%
17	Spain	364.561	25.8%	1.5%
18	Turkey	283.677	26.9%	1.1%
19	Taiwan	283.676	32.0%	1.1%
20	Thailand	282.180	45.3%	1.1%
-	Remaining Countries	5,948.108		24.1%

See also

• Manufacturing
• Three-sector hypothesis
• Industrial policy
• De-industrialization crisis
• Industry information