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Chapter 5 Secondary Activities
Introduction
Economic activities are actions undertaken by humans that result in the generation of income. These are broadly categorised into primary, secondary, tertiary, and quaternary sectors, representing different levels of complexity and involvement with resources.
Defining Secondary Activities
Secondary activities are those that add value to natural resources by processing raw materials obtained from primary activities into finished or semi-finished products. They involve transformation and manufacturing processes.
For example, cotton picked from a plant (primary activity) has limited direct use. However, when processed into yarn and then fabric (secondary activity), its value increases significantly, and it can be used to make clothing. Similarly, iron ore extracted from the earth (primary activity) is not directly usable, but when smelted and converted into steel (secondary activity), it gains immense value and becomes a versatile material for producing machines, tools, and structures.
This transformation process applies to most materials derived from farming, forestry, mining, and fishing. Therefore, secondary activities primarily encompass manufacturing, processing, and construction (building infrastructure).
Red-Collar Workers
People who are engaged in primary activities are sometimes referred to as red-collar workers because much of their work is performed outdoors and involves manual labor, sometimes in potentially hazardous conditions.
Manufacturing
Manufacturing is a key part of secondary activities. It involves the systematic transformation of raw materials or components into finished goods. The scope of manufacturing is vast, ranging from traditional handicrafts made by hand to complex processes like shaping metals, assembling electronics, or constructing vehicles.
Despite the diversity, modern manufacturing processes share common characteristics: the application of power or energy, the large-scale production of identical products (mass production), and the use of specialized labor performing specific tasks, typically within factory settings, to create standardized commodities.
'Manufacturing' vs. 'Manufacturing Industry'
The term 'manufacturing' literally means 'to make by hand' (from Latin 'manus' for hand and 'factum' for made). However, in modern usage, it includes production done by machines as well.
Conceptually, an industry refers to a group of geographically located manufacturing units operating under a management system, often maintaining financial accounts and records. While 'industry' is often used interchangeably with 'manufacturing' when discussing sectors like the 'steel industry' or 'chemical industry', it can also refer to secondary activities not performed in factories, such as the 'entertainment industry'. To be more precise about the physical production process, the term 'manufacturing industry' is used.
Characteristics of Modern Large Scale Manufacturing
Modern large-scale manufacturing, typical of industrial economies, exhibits several distinct characteristics:
Specialisation Of Skills/Methods Of Production
Modern manufacturing contrasts with older 'craft' methods. While craft involves producing a few bespoke, made-to-order pieces at high cost, modern manufacturing utilizes mass production. This involves producing large quantities of identical, standardized parts using specialized labor, where each worker performs a simple task repeatedly on an assembly line. This increases efficiency and lowers costs per unit.
Mechanisation And Automation
Mechanisation is the use of machines and gadgets to perform tasks previously done by hand. Automation is a more advanced stage of mechanisation where the manufacturing process is controlled by machines or computer systems with minimal human intervention during the production flow. This includes highly sophisticated automatic factories using feedback loops and computer control systems capable of performing tasks that mimic human 'thinking' within defined parameters.
Technological Innovation
Modern manufacturing relies heavily on continuous technological innovation, driven by intensive research and development (R&D). This is crucial for maintaining and improving product quality, reducing waste and inefficiencies in production processes, and developing cleaner technologies to combat environmental pollution.
Organisational Structure And Stratification
Large-scale manufacturing industries have a complex organisational structure characterized by:
- The use of advanced and complex machine technology.
- Extreme specialization and division of labor to maximize output with less effort and cost.
- Requirement of vast amounts of capital investment.
- Large organizational structures to manage complex operations.
- A hierarchical executive bureaucracy for planning, decision-making, and coordination.
Uneven Geographic Distribution
Modern manufacturing is concentrated in a relatively small number of locations globally, covering less than 10% of the world's land area. These concentrations are typically found in developed countries, which historically became centers of economic and political power. Manufacturing sites occupy significantly less land area than agriculture for equivalent economic output due to the higher intensity of industrial processes. For instance, an agricultural area supporting a small population with many workers might, if industrialised, house large factories employing thousands.
Factors Influencing Industrial Locations
Industries seek locations that minimize production costs to maximize profits. Several key factors influence where large-scale industries are established:
Access To Market
Availability of a market is the single most important factor. A 'market' consists of people who both desire the manufactured goods and have the purchasing power to buy them. Developed regions (Europe, North America, Japan, Australia) with high purchasing power and densely populated regions (South and Southeast Asia) offer vast markets. Some industries, like aircraft or arms manufacturing, serve a global market.
Access To Raw Material
Raw materials should be inexpensive and easily transportable. Industries using bulky, heavy, or weight-losing raw materials (where the final product is lighter than the inputs) are often located close to the source of these materials to save on transport costs (e.g., steel industry near iron ore and coal, sugar mills near sugarcane fields, cement factories near limestone deposits). Industries processing perishable materials (like agro-processing or dairy) also need to be located close to the supply source to prevent spoilage.
Access To Labour Supply
Availability of labor is still an important consideration, although increasing mechanisation and automation have reduced the overall dependence on human labor in some industries. However, certain types of manufacturing still require specific skilled labor.
Access To Sources Of Energy
Industries that consume large amounts of power, such as the aluminum industry, are often located near energy sources. Historically, coal was the primary energy source influencing location, but today, hydroelectricity and petroleum are also crucial for many industries.
Access To Transportation And Communication Facilities
Efficient transportation is vital for moving raw materials to factories and distributing finished goods to markets quickly and affordably. Transport costs significantly influence location decisions. Regions with well-developed transport networks (like Western Europe and eastern North America) have historically attracted industrial concentration. Modern industry is heavily reliant on integrated transport systems. Communication facilities are also essential for managing information and coordinating operations.
Government Policy
Governments often implement 'regional policies' aimed at promoting balanced economic development across the country. These policies can include incentives or infrastructure development in specific areas, influencing industrial location decisions.
Access To Agglomeration Economies/Links Between Industries
Industries can benefit from locating near other related industries or a prominent 'leader-industry'. These benefits, known as agglomeration economies, arise from shared infrastructure, access to suppliers, specialized services, or a skilled labor pool. The savings derived from these linkages encourage the clustering of industries.
All these factors interact and are weighed by firms when deciding on the optimal location for large-scale industrial units.
Foot Loose Industries
Footloose industries are a type of industry that is not tied to any specific location based on raw material source (whether bulky or weight-losing), power, or market proximity. Their flexibility allows them to be located in a wide variety of places.
Key characteristics include:
- Dependence on component parts, which can be sourced from anywhere.
- Production in relatively small quantities.
- Employment of a small labor force.
- Generally non-polluting nature.
- Primary location factor is good accessibility via road networks.
Classification of Manufacturing Industries
Manufacturing industries can be classified based on several criteria, providing different ways to understand their nature and scale. The main bases for classification are size, inputs/raw materials used, output/products produced, and ownership structure.
Industries based on Size
Industry size is determined by factors such as the amount of capital invested, the number of workers employed, and the volume of goods produced. Based on size, industries are categorised into household or cottage, small-scale, and large-scale.
Household Industries Or Cottage Manufacturing
This is the smallest manufacturing unit, often based in the producer's home. Artisans use locally available raw materials and simple tools. Production involves family members or part-time helpers. Products are typically for personal consumption, sale in nearby village markets, or barter. This type of manufacturing has low commercial significance, requires minimal capital, and is not heavily dependent on transportation.
Common products include food items, textiles, mats, tools, furniture, footwear, pottery, bricks, jewellery, and crafts made from local materials like wood, bamboo, leather, clay, and metals.
Small Scale Manufacturing
Small-scale manufacturing is larger than household industry. It uses local raw materials, simple power-driven machines, and semi-skilled labor, often operating from a workshop outside the home. It plays a significant role in providing employment and boosting local purchasing power. Many developing countries (like India, China, Indonesia, Brazil) have promoted labor-intensive small-scale manufacturing to create jobs for their large populations.
Large Scale Manufacturing
This involves extensive production processes requiring a large market, diverse raw materials, substantial energy consumption, a specialized workforce, advanced technology, and assembly-line mass production techniques. It demands significant capital investment. Large-scale manufacturing first developed in the UK, northeastern USA, and Europe over the last 200 years and has since spread globally.
Major large-scale industrial regions can be categorised into:
- Traditional Large-scale Industrial Regions: Found in developed countries, often densely clustered.
- High-Technology Large-scale Industrial Regions: More recently developed, often diffused to or emerging in less developed countries.
Industries based on Inputs/Raw Materials
This classification groups industries based on the primary type of raw material they process:
Agro-based Industries
These industries process raw materials obtained from agriculture. Agro-processing transforms produce from fields and farms into products for consumers. Examples include food processing (canning, fruit processing, confectionery), sugar production, beverages (tea, coffee, cocoa), spices, oils, and textiles (cotton, jute, silk), as well as rubber processing.
Agri-business is a related concept referring to commercial farming conducted on an industrial scale, often funded by non-agricultural businesses. These farms are large, mechanized, highly structured, rely heavily on chemicals, and can resemble "agro-factories".
Mineral-based Industries
These industries use minerals as their primary raw materials. They can be further divided based on the type of mineral:
- Using ferrous metallic minerals (containing iron), like the iron and steel industry.
- Using non-ferrous metallic minerals (not containing significant iron), like aluminium, copper, and jewellery industries.
- Using non-metallic minerals, such as the cement and pottery industries.
Chemical-based Industries
These industries process natural chemical minerals (like petroleum in the petrochemical industry, salts, sulphur, potash) or materials derived from wood and coal. Examples include the production of synthetic fibers and plastics.
Forest-based Industries
Industries relying on products from forests for raw materials. Examples include the timber industry (for furniture), wood, bamboo, and grass used in the paper industry, and lac used in lac industries.
Animal-based Industries
These industries use raw materials obtained from animals, such as leather (for the leather industry), wool (for woolen textiles), and historically, ivory (though trade is largely restricted now).
Industries Based On Output/Product
Industries can be classified based on the nature of the goods they produce:
Basic Industries
These industries produce goods that are used as raw materials or components by other industries. They form a foundational link in the production chain. For example, the iron and steel industry produces steel, which is then used by other industries to make machinery or vehicles. The product of a basic industry becomes an input for another industry.
Consumer Goods Industries
Also known as non-basic industries, these produce goods that are directly consumed by the final user. Examples include industries making food products (bread, biscuits), beverages (tea), personal care items (soaps, toiletries), paper for writing, televisions, and other household items.
Industries based on Ownership
This classification distinguishes industries based on who owns and manages them:
Public Sector Industries
Owned and managed by the government. Common in socialist economies and often present alongside private industries in mixed economies (e.g., Public Sector Undertakings (PSUs) in India).
Private Sector Industries
Owned and managed by individuals or private corporations. Predominant in capitalist economies.
Joint Sector Industries
Managed jointly, often by a combination of private and public sector entities, or by joint stock companies where ownership is distributed among shareholders.
Concept of High Technology Industry
High Technology (High-tech) industry represents the leading edge of manufacturing activities. It is characterized by the intense application of research and development (R&D) to create products with advanced scientific and engineering features.
Characteristics Of High-Tech
Key features of high-tech industries include:
- Emphasis on R&D and rapid innovation.
- Production of technologically sophisticated goods.
- A high proportion of professional, highly skilled 'white-collar' workers compared to 'blue-collar' production workers.
- Advanced production techniques like robotics, computer-aided design (CAD) and manufacturing (CAM), and electronic controls.
Workforce And Examples
The workforce in high-tech industries is dominated by experts and specialists (scientists, engineers, analysts) involved in research, design, and management. Examples of high-tech manufacturing processes include the use of robotics in assembly, computer-controlled manufacturing, and the development of new chemical and pharmaceutical products.
Landscape And Locations
The physical landscape of high-tech industries often features dispersed, low-rise modern buildings housing offices, research laboratories, and small-scale production plants, rather than large traditional factories. Planned business parks designed for high-tech start-ups and established firms are common. High-tech industries are often attracted to the peripheral areas of major metropolitan centers or areas with access to universities and research institutions, providing a skilled workforce and knowledge base.
Technopolies
Regional concentrations of high-tech industries that are largely self-sustained and highly specialized are referred to as technopolies. Famous examples include Silicon Valley in California (USA) and Silicon Forest near Seattle (USA). Such regions become hubs for innovation, research, and high-tech production.
Overall Contribution And Important Industries
Manufacturing plays a vital role in the global economy, contributing significantly to output, employment, and trade. Some of the world's most important manufacturing industries, based on their economic scale and impact, include iron and steel, textiles, automobiles, petrochemicals, and electronics.