Understanding the 3 Economic Sectors: Primary, Secondary & Tertiary
Economic Sectors
Definitions:
Activity: Match the definitions with the sectors: Primary, Secondary, and Tertiary.
- Economic activities that transform raw materials into other products to meet human needs. (Secondary Sector)
- Economic activities related to obtaining resources directly from nature. (Primary Sector)
- All activities that do not produce material goods but provide services for people or other sectors. (Tertiary Sector)
The Primary Sector
There are four main activities in the primary sector that use land or water to obtain natural resources:
- Agriculture: The cultivation of land to obtain different kinds of plants: grasses (cereals); vegetables; bushes (vines); or trees (olive, fruit trees). They provide food for people, fodder for cattle, and raw materials for industry.
- Livestock Farming: The breeding of animals to obtain products for human use. A great variety of animal species are bred, but the most common are cows, sheep, goats, pigs, and poultry. Livestock farming provides food and raw materials for industry (meat, milk, leather, wool, fertilizer).
- Forestry: Consists of managing forests to obtain natural products such as wood (used to make furniture and paper), rubber, and resins.
- Fishing: Any activity that obtains natural products from the sea. It is used to obtain food and raw materials for industry: canned goods, frozen goods, oils, fish meals, fertilizers, etc.
In general, the primary sector accounts for over 50% of the active population in developing countries, but less than 10% in developed countries.
The Secondary Sector
This sector includes economic activities that transform raw materials into other products to meet human needs. These activities are industry, mining, energy production, and construction.
Industry
Industry is the biggest activity within the secondary sector. It transforms raw materials into finished products for direct consumption or as materials in other industrial processes.
Industry needs raw materials, sources of energy, and production factors.
- Raw Materials: The natural products that industry transforms into finished products.
- Sources of Energy: The natural resources that provide the power necessary to drive machines and carry out the process of industrial transformation (e.g., atomic, electric, petroleum).
- Production Factors: The workers or workforce, physical space (including storage), capital (the most important factor), and technology.
Mining
Mining is the process of locating, extracting, and refining rocks and minerals found in the ground. To carry out this activity, the following are required:
- Prospecting Methods: To locate the minerals (nowadays, scanners are often used).
- Extraction Techniques: These vary depending on whether the minerals are found in open-air deposits (quarries) or underground deposits (mines).
- Refining Systems: To separate the usable mineral (ore) from the surrounding rocks (gangue) which are of no commercial interest.
Energy Production
Energy production transforms fuel into forms of energy, such as heat or electricity, which make it possible to do work. Major investments and large facilities are required for energy production.
Types of energy sources include thermal stations (carbon, gas), nuclear power stations, wind power stations, solar power stations, and hydraulic power stations. Some power stations use a mix of energy sources, such as petroleum and seawater.
Energy production is expensive, requiring location scouting, construction in suitable locations, and the actual production process.
Construction
Construction creates different types of structures, including buildings, roads, bridges, and dams. This activity requires materials such as steel and concrete, which are the most used today. Construction has a significant impact on the environment.
The Tertiary Sector
The tertiary sector or service industry includes all activities that do not produce material goods but provide services for people or other economic sectors. It includes:
- Health Care
- Education
- Communications
- Transport
- Finance
- Commerce
- Tourism
In developed countries, services are widespread, and the majority of people have access to basic services such as healthcare and education.
In developing countries, services are insufficient, and most of the population does not have access to basic services.
Classification of Services
There are two types of service providers:
- Private or Market Services: Provided by private companies that charge money to people or other companies who require the service. Their main objective is to earn profits.
- Public or Non-Market Services: Provided by the State with money collected through taxes. Their purpose is to provide basic services to society, rather than making profits. They include public administration, healthcare, and education.
Location of Services
Traditionally, service providers have located themselves close to consumers. The most specialized services were located in large cities, while less specialized ones were distributed more uniformly around the country. Improvements in transport and new communication technologies mean that certain services have moved to areas with lower costs, such as small and medium-sized towns.