1.5 Who loses from the Global Shift and Globalisation?

Deindustrialisation - MEDCs

Deindustrialisation

• The decline in the number of people employed in the secondary sector as manufacturing industries have closed.

• Deindustrialised areas include south Wales (incl. ‘The Valleys’), northeast England (Tyneside, Wearside, Teesside) and the Ruhr region of Germany and the ‘Rust Belt’ area of the north eastern USA e.g. Detroit.

north east England

The Ruhr Region of Germany –Cities include Dortmund, Bochum, Duisburg

The ‘Rust Belt’ of USA

Change in total number of manufacturing jobs in metropolitan areas, 1954-2002. brown >58% loss

Factors leading to Deindustrialisation:

• WHAT? decline in manufacturing

• WHERE? Regions of North America and Europe

• WHEN? That had industrialised in the nineteenth and early twentieth centuries and really declined around the 1980s (late twentieth century).

Reasons for deindustrialisation:

• many products at the end of their life cycle - newer products have replaced the old.

• Outmoded production methods have been replaced by newer technologies requiring less labour

• Labour has clung to old practices and there has been poor labour management

There is competition from cheaper locations with low labour costs

LEDCsBRICNICsRICs

There was recession in the 1980s.

GDP change in USA

• oil price rises OPEC 1970s

• rapid inflation followed

• tight government policy to control inflation (Cut in spending)

• Mrs. Thatcher UK and President Reagan USA

Government support for industries such as coal and steel has been removed.

British Steel PLC was a major British steel producer. It originated as a nationalised industry, the British Steel Corporation (BSC), formed in 1967. This was converted to a public limited company, British Steel PLC, and privatised in 1988. It was once a constituent of the FTSE 100 Index. The company merged with a Dutch steel company to form Corus Group in 1999. Corus taken over by Tata Steel (of India) in 2007.

Firms have needed to rationalise production.

When a company, system, or industry is rationalised, it is made more efficient, usually by getting rid of staff and equipment and sites that are not essential.