Relative Importance of Economic Sectors
Relative Importance of Economic Sectors
The importance of each sector in a country is judged by:
The percentage of workers employed in that sector
The value of goods and services produced by that sector
In developing countries:
The primary sector (farming, fishing, mining) is the most important
A large number of people live in villages and work on land
Incomes are low, so demand for services is small
Because of this, both employment and output in the primary sector are higher than the other two sectors
Manufacturing industries are still new and not fully grown
In countries with older manufacturing industries:
The secondary sector and tertiary sector employ more workers
Farming becomes a smaller part of the economy
More people work in factories and service jobs
Output of primary sector becomes lower compared to the other sectors
In developed countries:
Many manufactured goods are bought from other countries
Most workers are employed in the service sector
Output of the tertiary sector is often higher than primary and secondary combined
These countries are known for strong service industries like banking, transportation, education and health care