Unit 5

Tertiary Activity

Chapter 14

(text)

Introduction

Tertiary Activity:

• Involves service industries, which provide services for people.

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

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 in the tertiary sector cannot be classified as

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

Four Types of Tertiary Activity

1. Distributive activities:

• involves the transportation and sale of all products from manufacturer to consumer. Ex. truck driver, warehouse manager, sales person.

Four Types of Tertiary Activity

2. Financial Activity:

• involves banks, insurance companies, financial advising companies, and trust companies.

Four Types of Tertiary Activity

3. Personal Service: • involves a wide range of services from legal services, to

food services, to entertainment and counselling services.

Four Types of Tertiary Activity

4. Government service:

• Public service industry is operated by Government and is not for profit. On the contrary it cost tax payers money. Ex. Education, health care, mail, water, sewer, roads. Hence the term “ public servant”.

Factors affecting the location of Tertiary Activity

1. Proximity & price are two key factors that determine the location of service industries.

• Location: services must be located close 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.

Factors affecting the location of Tertiary Activity

2. Service Availability vs. Population Size.

• Larger populations support a wider range of services.

• Consider: Health services, education, recreation facilities, shopping facilities, hotels, restaurants and you will see that the range of services available is directly related to community size.

Patterns in World Trade for a Selected Service

Example TOURISM

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

• If your country is located in a sunny area, has good ski slopes or has cultural attractions then people will flock there and spend money.

• From a country's perspective international tourism is new money coming to the country.

International tourism has increased dramatically for 6 reasons:

1. people have 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.

Travel agents see that people are usually looking for one of three different kinds of vacations:

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

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 range of services include:– financial, insurance, real estate, trade, transportation and

communications, retailing, government, health care, education, personal care, tourism, recreation, etc.

• Services are more evident in cities and towns because there are more people living in urban areas.

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 growing and is becoming a much larger part of the economy of developed nations.

Why the tertiary industry is growing.

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

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

• The concentration of people meant there was more need for services. Service industries grow in turn.

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

• We will look at two tertiary growth sectors in particular, International tourism and information technology.

Assigned Work & Readings

• "International Tourism in the Tertiary Sector" p. 245-246

• Complete questions # 11-14 on page 246 of your text book.

• Case Study "Costa Del Sol" p. 247-248 complete questions #15-18