Location of Economic Sectors (Edexcel IGCSE Geography)

• Every type of economic activity has a particular location
• The location is affected by both physical and human factors
• These factors relate to the needs of the economic activity
• Physical factors include:
  • Raw materials - industries require raw materials to produce goods
  • Land - how much land costs and how much is available  
  • Energy - where the industries get their power supply from
  • Climate - some industries benefit from particular climates
• Human factors include:
  • Capital - the money that is available to set up and run the economic activity
  • Transport and communications - accessibility by road, air and rail is important to many industries
  • Market - how close the industries are to the market
  • Labour - all industries need workers
  • Government policy - tax incentives, cheaper rent

The Importance of Location Factors in Different Economic Sectors

• Primary economic activities include agriculture, mining, forestry and fishing
  • Distance from the market and cost of transport would be particularly important for mining due to the bulky products 
  • Climate would be more important for agriculture 

Factors affecting location	Primary
Climate	Precipitation, sunshine hours and temperature all affect the type of crops grown or livestock
Land	The amount of land available, cost, soil type and resources (coal, gold)
Market	Some crops need to be very close to the market - such as soft fruits (strawberries)
Government Policies	Whether subsidies are available
Labour	In developed countries, there are few workers needed due to mechanisation
Transport	Access to roads to transport crops, animals, quarried/mined materials, timber

• Secondary economic activities involve manufacturing such as cars, food processing, ship building. The importance of the location factors depends on:
  • The weight of raw materials and the finished product as heavier, bulky products cost more to transport
  • The size of the factory required, car manufacture needs much more space than food processing or clothing production

Factors affecting location	Secondary
Raw materials	How close the activity needs to be to raw materials and the types of raw materials will depend on the industry
Land	Large areas of land often required, so the cost and amount of the land is important
Market	Access to the market is important to be able to sell the goods made
Government policies	Tax incentives, grants, and loans may be available if the economic activity is located in a particular area
Energy	A power source is needed, this used to be coal or water but is now electricity which can be accessed in many areas
Labour	Mechanisation means that not as many workers are required
Transport	Access to roads is essential to bring in raw materials and send out the product

• Tertiary economic activities involve providing a service such as healthcare or retail. The most important factor for location is usually:
  • Proximity to the customers 

Factors affecting location	Tertiary
Land	The amount of land depends on the type of economic activity, large retail parks need lots of land
Market	Needs to be close to the customers
Energy	A power source is needed - electricity which can be accessed in many areas
Labour	Workers needed both skilled and unskilled
Transport	Needs to be accessible for customers, workers and in the case of retail to bring in the products

• Quaternary economic activities involve high technology such as research and development. The most important factors in their location:
  • Proximity to skilled workers and universities 
  • Pleasant working environment

Factors affecting location	Quaternary
Land	Science parks need large areas of land usually near a university on the rural-urban fringe
Energy	A power source is needed - electricity which can be accessed in many areas
Labour	Skilled labour needed often university graduates
Transport	Needs to be accessible to the workers

• The location of economic activities do not stay same but change over time
• The location of primary industry may be affected by a number of factors:
  • Drought, soil erosion, flooding and other events may lead to decreased growth of crops/raising of livestock
  • Raw materials may run out in an area or become economically unviable 
  • Climate change may affect the types of crops which can be grown 
• The location of manufacturing activities or secondary economic activities has changed significantly:
  • Transport is faster and cheaper which means products can be moved around the world 
  • An increase in transnational corporations (TNCs) with factories and offices in many countries
  • Factories were once tied to a power source of coal supplies or water. Electricity is now available almost anywhere
  • The internet means instant communication with factories/offices around the world is possible
  • Government policies in emerging and developing countries are aimed at attracting manufacturing often using tax incentives
  • Cheaper labour, less strict health and safety, cheaper land and more workers are all available in developing and emerging countries. These reduce costs and increase profits
  • Raw materials may no longer be available in the area 
• These changes have led to a reduction in secondary economic activities in developed countries such as the UK
• This is known as deindustrialisation

• The location of tertiary and quaternary economic activities is increasingly located in rural (greenfield) areas on the rural urban fringe due to a number of factors:
  • There is more open space for expansion and car parking
  • Land is cheaper
  • More accessible 
  • Located near the suburbs and commuter village - good access for workers and customers
  • Increase in science parks, business parks and retail parks where similar businesses are located together
• This process is known as decentralisation