Global Connections: Industry

Objectives Identify the different types of industry sectors. Explore the spatial relationships of trade. Consider location factors for industries: why do industries locate where they do? Analyze the impact of the global trade network and how it is changing.

Industries – Types of Economic Activities Primary industries – extraction of raw materials. Secondary industries – manipulation of raw or altered materials into fuels or finished products. Tertiary industries – provision of services or non-tangible goods. Quaternary – transportation, communications, real estate, insurance, finance, management. Quinary – Research, education, and engineering – creation of new ideas and technologies through expanded knowledge and skills.

Primary Industries Staple theory – the resources available to an area shape its economic system through linkages Linkages = all the extra activities that arise alongside the primary industry. Two perspectives toward the future: Mackintosh – an economy based on a primary industry allows for further industrial development. Innis – dependence on a primary industry limits economic growth through dependency on that commodity. Price sensitivity! Prices don’t rise as quickly as manufactured goods! Lack of diversification! GREAT map page 299.

Secondary Industries - Industrial Revolution HowStuffWorks.com Changes: Transportation – canals, river, road, rail, sea transport Production – iron, coal, textiles, food production becomes more efficient, creates increased profits and production Economy – shift from agriculture to industry & trade Society – Women and children begin working outside the home; Middle class grows * Fundamental changes in technology and systems of production beginning in England. * Beginning in the late 1700s.

Industrial Centers

What Do You Notice?

What Factors Influence Industry Location? Situation Proximity to inputs To save on transportation costs bulk-reducing industries locate closer to inputs than to markets. Proximity to markets When it is more expensive to transport the final product than the raw materials the industry locates closer to the markets. This is a bulk-gaining industry. Transportation Mode of transport impacts shipping costs. Distance impacts cost and attractiveness of different methods. Agglomeration! Political policies (right to work laws)

What Factors Influence Industry Location? Site Factors: Labor Costs / Availability Land availability / Costs Energy availability and costs Environmental regulations Amenities / tax advantages

Systems of Production - Fordism System of industrial production for mass production based on scientific management. Deskilled labor Reinforced social hierarchy Growth of MNCs Requires reliable inputs – materials and labor Need mass consumers! BORING. Vertical Integration – control of multiple production stages directly or indirectly Producer-driven commodity chains

Systems of Production – Flexible Production Increased manufacturing costs in the 70s and better technologies == Fordism Crisis Consumer-driven commodity chains More worker power / collaboration / critical thinking Just – in –time delivery Smaller inventory can be kept. Outsourcing – subcontracting work that was once done in-house. Offshoring -- transfer of internal or outsourced activity to an international location.

Globalization and Industry Edward Burtynsky Two Principle features of the Global Economy: Two main components: 1. Global assembly line – refers to a network of labor and production processes that produce a finished product for the global market. 2. Consolidation of companies into transnational corporations.

Where Are Your Clothes From? World Map

The Times They Are A-Changin’… Is Wal-Mart Good For America? Why does Wal-Mart get goods from China? What are the positive and negative outcomes of the global economy, based on what we see in this brief film? How much would an all-American iPhone cost?

Attraction of New Industrial Regions Within the US shifting to the South and West Partly because of the Right-to-Work laws in Southern states that limit union power Internationally In Europe shifting to Eastern Europe, Spain, Portugal, Italy, and Greece under EU policy Still see industry moving from MDCs to LDCs – East Asia, South Asia, and Latin America Why?

New International Division of Labor Transnational corporations move some segments of their production to low-cost areas. Highly skilled positions remain in the more developed countries. US role as a manufacturer is declining – more people in and profit from research, services, and advertising.

Review – Things to Focus on For Exam How does geography help us understand industry? What was the Industrial Revolution? What factors influence industry location? Site: Examples? Situation factors: Examples? Bulk-reducing and bulk-gaining industries-what are they and examples? Globalization and industry—what are the principal features? The main components? What is a global assembly line? What is the New International Division of Labor? Where is manufacturing moving in the US and internationally? Why? Wal-Mart video: Why does Wal-Mart get products from China? What are the positive and negative outcomes?