Unit 5

Tertiary Activity

Chapter 14

(text)

Introduction

Tertiary Activity:

• Involves service industries which provide services for people.

• People “serving” people!!

• Examples. Doctor, lawyer, waitress, tourism industry, mechanic, teacher

REMEMBER….Tertiary economic activity

– The focus is on people interacting with people and serving

the customer rather than transforming physical goods

– Often referred to as the service industry.

– A service occurs when a person performs some type of

ACTION.

EXAMPLES INCLUDE:

•Nurses, doctors, mechanics

•lawyers, teachers, waitresses, technicians

•hairdressers, repair and sales people

•Tourism is an important part of the tertiary sector & golf

has become a thrust for investment in NL.

Public vs. Private Tertiary Activity

Public service industry

• is usually run by the government and are available to anyone in society.

• Ex. Health care, public transportation, education.

Private service industry

• is run by private business and requires that a profit be made from the service.

• Ex. mechanics, lawyers, tourism.

NOTE:

• some careers can be classified as public or private.

• Ex: A teacher can work in the public school system or for a private college.

Four Categories of Tertiary Activity1. Distributive activities:

• distribution or movement of goods

• involves the transportation and sale of all products from manufacturer to consumer.

• Ex. truck driver, warehouse manager, sales person.

2. Financial Activity:

• involves banks, insurance companies, financial advising

companies, and trust companies.

Four Categories of Tertiary Activity

3. Personal Service:

• involves a wide range of services from legal services, to food

services, to entertainment and counselling services.

Four Categories of Tertiary Activity

4. Government service:

• Public service industry is operated by Government and is not for profit.

• Paid for by Tax payers!!

• Ex. Education, health care, mail, water, sewer, roads. Hence

the term “ public servant”.

Four Categories of Tertiary Activity

Which category of Tertiary Activity is ach of the following?

a. Sameday Courier drops off a Christmas present from your Uncle…

b. You get fungus removed from your feet at the Foot Spa…

c. The town removes snow from your street after a snow storm..

d. You buy stocks in Abitibi-Bowater from a local stock broker…

e. You have your Poodle shaved and groomed…

f. You order a piece of lingerie from the catalogue at Sears…

Four Categories of Tertiary Activity

Factors affecting the location of Tertiary Activity

The MAIN FACTOR affecting Tertiary Activities is POPULATION!!!

• Location: Being located close (Proximity) to a large enough

market to produce DEMAND.

• Viability: services are only viable as businesses if the demand

is high enough & the price is reasonable.

• Larger populations support a wider range of services and even

competition within services.

Patterns in World Trade

for a Selected Service

Example TOURISM

• one of the fastest growing and most profitable sectors of the economy.

• Ex. sunny area, good ski slopesor cultural attractions = people will flock there and spend money.

• From a country's perspective international tourism is NEW MONEY coming into the country.

International tourism has increased

dramatically for 6 reasons:

1. increased leisure time due to available technologies.

2. retired people have secure incomes and are able to

travel.

3. people have increased discretionary spending

money.

4. travel has become easier and less expensive.

5. travel agencies have packaged attractive "all

expenses paid" trips.

6. advertising has been effective using attractive &

exotic pictures.

1. Climate oriented (skiing & sun bathing are at opposite extremes but both rely on climate). PLACES??

2. Landscape oriented (some people like to view the sites). PLACES??

3. Culture oriented (cultural land marks are of interest to people ex. Athens) . PLACES??

Marble Mountain, NewfoundlandAthens, Greece

Travel agents see that people are usually looking for

1 of 3 different kinds of vacations:

Importance of the tertiary industry

• Service industries provide services needed by ALL of society!

• They provide services to the primary, secondary AND the tertiary industries.

• Without these services, society could not operate.

• The BROAD RANGE of services include:

– financial, insurance, real estate, trade, transportation and communications, retailing, government, health care, education, personal care, tourism, recreation, etc.

• more people living in urban areas = more services.

The Growing Tertiary Industry

• Economists recognize that the tertiary industry has expanded significantly in the last 100 years.

• Figure 14.3 on page 243 of your text shows that in Canada the tertiary sector of the economy has grown from 36% of GNP - 73% of GNP over the last 100 years.

• Approximately 70% of the work force in Canada is engaged in the service area.

• The entire tertiary sector is becoming a much larger part of the economy for DEVELOPED NATIONS.

Why the tertiary industry is growing.

• As the secondary sector of the economy grew, there were more people working in urban areas at manufacturing.

• The concentration of people meant there was more need for services.

• The multiplier effect is in part responsible for this phenomenon.

• The people working in the tertiary industry need services too so the growth of the service industry continues.