Secondary sector of the economy
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| Economic sectors |
| Three-sector hypothesis |
|---|
| Colin Clark |
| Jean Fourastié |
| Primary sector (raw materials) |
| Secondary sector (manufacturing) |
| Tertiary sector (services) |
| Others suggested |
| Quaternary sector |
| Quinary sector |
| By ownership |
| Public sector |
| Private sector |
| Business sector |
| Voluntary sector |
The secondary sector of the economy includes those economic sectors that create a finished, usable product: manufacturing and construction. This was the primary economic sector in America from the 1820's-1940's
This sector generally takes the output of the primary sector and manufactures finished goods or where they are suitable for use by other businesses, for export, or sale to domestic consumers. 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. [1] Examples of service may include retail, insurance, and government. These economists contend that an economy begins to decline as its wealth-producing sector shrinks. [2] 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 in an economy.
Divisions of this sector include:
- Aerospace manufacturing
- Automobile industry
- Brewing industry
- Chemical industry
- Textile industry
- Consumer electronics
- Energy industry (petroleum industry, natural gas industry, electricity industry)
- Industrial equipment
- Metalworking
- Steel production
- Tobacco industry
[edit] See also
[edit] References
- ^ David Friedman, New America Foundation (2002-06-16).No Light at the End of the Tunnel Los Angeles Times.
- ^ Sir Keith Joseph, Center for Policy Studies (1976-04-05).Stockton Lecture, Monetarism Is Not Enough, with forward by Margaret Thatcher. (Barry Rose Pub.) Margaret Thatcher Foundation (2006).
