Sectors of the Economy

Year 10 students will hopefully be quite familiar with this concept at the moment. The UK economy (the whole business system) can be divided into three sections where businesses operate. Those three sections are Primary, Secondary and Tertiary. You might remember this from geography lessons!

Imagine how the process a product will go through to be made. It starts off being extracted from the land - e.g. oil for plastics, metal, wood from the forests. These items are known as raw materials. Simply, they are things within their orginal form which have been extracted from the land (e.g. through mining or tree felling). Those businesses whose job it is to extract these materials are all in the Primary Sector. They are primary sector business. A local farmer, for example, extracts food from the land using his tractor and other forms of machinery. The farmer is therefore a primary sector business.

Now lets move on to the second stage of the product's progress. Those raw materials will typically get sent to a factory or manufacturing plant where they will processed or manufactured into final products, ready to sell to the customer. BMW Mini, in Oxford, will take steel and turn it into a lovely sparkley new Mini. These businesses who convert raw materials to finished products are known as Secondary Sector businesses.

And finally, now we have to sell our final product to the customer. This will be often be done in a shop of some sort. So, we are providing a service to the customer. Any business which provides a service directly to the customer or consumer is know as a Tertiary Sector Business. The Tertiary Sector is all services. Other examples include the leisure industry - cinemas, gyms, holiday companies all are part of this sector.

What you need to find out - is what has happened in the last couple of decades to the amount of people working within these sectors? Where have the number of UK workers declined and where have they grown? There are several key reasons behind these changes. I'll give you a clue - foreign competition from overseas is one of the major reasons as well as the advancement of technology.