1. The Economy and Work
Sociology, Eleventh Edition

2. The Economy: Historical overview
Sociology, Eleventh Edition

3. The Economy
The Economy - The social institution responsible for organizing the production, distribution, and consumption of goods and services.
Goods – commodities ranging from necessities to luxuries.
Services – activities that benefit others.
Sociology, Eleventh Edition

4. The Agricultural Revolution
First societies were hunters and gatherers.
The introduction of the plow led to a new agricultural economy.
The surplus meant not everyone had to produce food  specialized work.
Towns soon developed.
Linked by trading networks.
Sociology, Eleventh Edition

5. Industrial Revolution
Industrialization changed the economy in 5 ways:
New sources of energy
Steam engine
Centralization of work in factories
Moved away from farming and work based out of homes
Manufacturing and mass production
Turning raw materials into a wide range of products
Specialization
Diverse division of labor and lower overall skill requirements
Wage labor
Working for strangers with intense supervision
Sociology, Eleventh Edition

6. The Information Revolution
Postindustrial economy – a productive system based on service work and high-technology.
The information revolution has altered the fundamental character of work in 3 ways:
From tangible products to intangible ideas
From mechanical skills to literacy skills
From factories to almost anywhere
Sociology, Eleventh Edition

7. Sectors Of The Economy Primary sector Secondary sector Tertiary sector
Generation of raw materials from the environment.
Secondary sector
Transformation of raw materials into manufactured goods.
Ex. Refining petroleum into gasoline or turning metals into tools and automobiles.
Tertiary sector
Economy generates services rather than goods.
Ex. Office work
Sociology, Eleventh Edition

8. DISCUSSION QUESTION
According to a study from the University of Michigan, ¾ of high school seniors work; 40% of seniors work more than 20 hours a week.
How many of you work?
How many hours a week do you work?
What sector do you work in?
Primary, secondary or tertiary
Sociology, Eleventh Edition

9. Figure (p. 421) The Size of Economic Sectors by Income Level of Country As countries become richer, the primary sector of the economy becomes smaller and the tertiary or services sector becomes larger. Sources: Estimates based on United Nations Development Programme (2000) and World Bank (2000).
Sociology, Eleventh Edition

10. The Global Economy
Global Economy – expanding economic activity with little regard to national borders.
Critics claim that the US is losing jobs, especially factory jobs, to low income nations.
Sociology, Eleventh Edition

11. DISCUSSION QUESTION What are the benefits of outsourcing jobs?
Consequences?
Is it worth it?
Sociology, Eleventh Edition

12. Global Map (p. 423) Agricultural Employment in Global Perspective The primary sector of the economy is largest in the nations that are least developed. Thus in the poor countries of Africa and Asia, up to half of all workers are farmers. This picture is altogether different in the world’s most economically developed countries – including the U.S., Canada, Great Britain, and Australia – which have 2 percent of their labor force in agriculture.
Sociology, Eleventh Edition

13. Global Map (p. 423) Service-Sector Employment in Global Perspective The tertiary sector of the economy becomes ever larger as a nation’s income level rises. In the U.S., Canada, the countries of Western Europe, Australia, and Japan, about two-thirds of the labor force performs service work. Sources: Data from U.N. Development Programme (2000) and World Bank (2000, 2001); map projection from Peters Atlas of the World (1990).
Sociology, Eleventh Edition

14. Economic systems: paths to justice
Sociology, Eleventh Edition

15. CAPITALISM
Capitalism - An economic system where the natural resources and the means of producing goods and services is privately owned.
Three distinct features:
Private ownership of property
Pursuit of personal profit
Competition and consumer sovereignty
Adam Smith - The “invisible hand” is at work so leave the market alone (free market economy).
Sociology, Eleventh Edition

16. SOCIALISM
Socialism - An economic system where the natural resources and the means of producing goods and services are collectively owned.
Three distinct features:
Collective ownership of property
Limits the right to private property
Pursuit of collective goals
Pursuit of profits stands at odds
Government control of the economy
Centrally controlled economy
Consumers should not drive economy
Sociology, Eleventh Edition

17. Alternative Systems
Communism – a hypothetical economic and political system in which all members of a society are socially equal.
North Korea, China or Cuba
Welfare Capitalism – an economic and political system that combines a mostly market-based economy with extensive social welfare programs.
Sweden or Italy
State Capitalism – an economic and political system in which companies are privately owned but cooperate closely with the government.
Japan, South Korea and Singapore
Sociology, Eleventh Edition

18. CAPITALISM VS. SOCIALISM
Economic productivity
GDP is $5,000.00
Economic equality
Less income disparity
Overall well-being
Lower standards of living, but less disparity
Personal freedoms
Stress is placed upon freedom from basic needs
Economic productivity
GDP is $13,500.00
Economic equality
More income disparity
Overall well-being
A high quality of life, but greater disparities
Personal freedoms
Are the heart of a capitalistic system
Sociology, Eleventh Edition

19. Work in postindustrial economy
Sociology, Eleventh Edition

20. THE WORKFORCE The Dual Labor Market Labor Unions Primary labor market
White collar work
Extensive benefits to workers
Secondary labor market
Blue Collar work
Minimal benefits to workers
Labor Unions
Organized labor seeking better wages and benefits for members.
Decline of unions
Loss of highly unionized jobs
Many temporary workers these days
Sociology, Eleventh Edition

21. Figure (p. 428) The Changing Pattern of Work in the United States, Compared to a century ago, work in the U.S. now involves mostly white-collar service jobs. Source: Estimates based on U.S. Department of Labor (2005).
Sociology, Eleventh Edition

22. Figure (p. 429) The Careers Most Commonly Named as Probable by First-Year College Students, 2004 Today’s college students expect to enter careers that pay well and carry high prestige. Source: Sax et al. (2004).
Sociology, Eleventh Edition

23. TRAITS OF PROFESSIONALS
Profession – a prestigious white collar occupation that requires extensive formal education .
An occupation is a profession if it demonstrates these four characteristics:
Theoretical knowledge
Self-regulated practice
Authority over clients
Community orientation rather than self-interest
Sociology, Eleventh Edition

24. Figure 16-4 (p. 430) Official U. S
Figure (p. 430) Official U.S. Unemployment Rates for Various Categories of Adults, 2004 Although college graduates have low risk of unemployment, race is related to unemployment for all categories of people. Source: U.S. Department of Labor (2005).
Sociology, Eleventh Edition

25. The Underground Economy
The U.S. government requires individuals and business to report their economic activity, especially earnings.
Unreported income makes a transaction part of the underground economy, economic activity involving income not reported to the government as required by law.
Sociology, Eleventh Edition

26. Thinking About Diversity (p
Thinking About Diversity (p. 432) Projected Increase in the Numbers of People in the U.S. Labor Force, 2002, 2012 Looking ahead, the share of minorities in the U.S. labor force will increase much faster than the share of white men and women. Source: Toossi (2004).
Sociology, Eleventh Edition

27. Effects of Computers on Work
Computers are deskilling labor.
Computers are making work more abstract.
Computers are limiting workplace interaction.
Computers increase employers’ control of workers.
Computers allow companies to relocate work.
Sociology, Eleventh Edition

28. CORPORATIONS
Sociology, Eleventh Edition

29. CORPORATION “Let's be from Vermont. And let's have an emerging
maple syrup conglomerate.”
Corporation - an organization with a legal existence, including rights and liabilities, apart from those of its members
Economic concentration
In 2002, Wal-Mart was the largest
$214 billion in revenue
700,000 employees
Conglomerates – giant corporation composed of several smaller corporations
Ex: Pepsico
Competition is a gray area
Monopoly: domination of a market by one corporation
Illegal
Oligopoly: domination of a market by a few corporations
Common
Sociology, Eleventh Edition

30. Corporations and the Global Economy
Corporations account for most of the world’s economic output.
They often look for low labor costs:
Mexico – average hourly wage $2.21
US – average hourly wage $17.12
Sociology, Eleventh Edition

31. Impact of Corporations on Poor Nations
Modernization theorists state that they unleash the great productive power of capitalism and speed development.
Dependency theorists argue that they make global inequality worse, blocking development of local industries, forcing them to grow cash crops, instead of being self sufficient.
Sociology, Eleventh Edition