(s)Kuby 6 Help Wanted: The Changing Geography of Jobs

Primary Secondary Tertiary Quaternary Sectors of the Economy Figure 6.1 (p. 143) Figure 6.11 (p. 155)

Least Cost Location Theory Cost minimization is half of the profit maximization equation Cost minimization varies according to the cost structures of particular industries Cost minimization theory: - labor-cost minimization - transportation cost minimization Why is cost minimization so important to a business?

Labor Cost Minimization Figure 6.1 (p. 143) Maquiladora workers in Matamoros, Tamaulipas, Mexico Today maquiladoras are on the decline. Why?

Figure 6.2 (p. 145) Raw Material Oriented Transportation Cost Minimization What raw materials need to be processed close to where they are extracted due to high transportation costs?

Figure 6.2 (p. 145) Transportation Cost Minimization Market Oriented What raw materials need to be processed close to markets due to high transportation costs? Coke Bottling Plants

Figure 6.2 (p. 145) Transportation Cost Minimization Break-of-Bulk Oriented What raw materials would be processed at a break-of-bulk point?

Figure 6.11 (p. 155) These massive machines exploit economies of scale, helping workers produce over 50 tons of coal per hour

Figure 6.3 (p. 147) Jewelry Trade Birmingham, England 1948 Can you think of other major agglomerations in the United States? Agglomeration Economies How do agglomeration economies benefit a particular business or store?

Figure 6.4 (p. 148) Location of semiconductor design houses Agglomeration Economies How did the largest agglomeration of semiconductor design houses come to exist in San Jose, California?

Figure 6.6 (p. 150) Location of semiconductor fabrication facilities Agglomeration Economies Why would it be more difficult for one fabrication facility in a city to be economically successful than it would be for a fabrication facility that exists in a city where there are several others located in close proximity?

Primary sector location Location of early industries Spatial division of labor Life cycle of industries What are some of the factors influencing the location of primary sector economic activities? * How does an early industry in an agglomeration economy get started in a given location?

Figure 6.7 (p. 151) Economic Base Model * Where does the "regional multiplier" effect manifest itself in this model? Why do basic industries create more economic activity than non-basic?

Name That Key Term

An economic activity that transforms raw materials into usable products, adding value in the process. Secondary Activity Highly skilled, information-based services. An economic activity that directly extracts or harvests resources from the earth. Primary Activity Quaternary Activity An economic activity that links the primary and secondary sectors to the consumers and other businesses either by selling goods directly or by performing services utilizing those goods. Tertiary Activity

The dominant mode of production and consumption of the late nineteenth and early twentieth centuries, emphasizing large domestic corporations engaged in food processing, heavy equipment manufacturing, and energy products. Industrial Economy The emerging mode of production and consumption of the late twentieth and early twenty-first centuries, featuring huge transnational corporations and localized agglomerations that produce and/or utilize information technology and telecommunications, with greater employment in tertiary and quaternary services. Postindustrial Economy

Amount produced per worker per hour. Labor Productivity Tasks done for consumers or businesses for a fee. Services The unseen costs of doing business; the costs required for gathering information about, negotiating, and enforcing contracts in the exchange of a product or service. Available nearly everywhere. Ubiquitous Transaction Costs Services provided by businesses to other businesses. Also known as business services. Producer Services The specialization of workers in particular tasks and different stages of the production process. Division of Labor

Leakage of technological knowhow to other people and firms usually located in close proximity. Technological Spillovers Goods used to produce other goods. Capital Goods Effects that extend beyond any single company. ______ economies of scale, for instance, are cost savings due to a larger volume of production in the region as a whole rather than a large volume within any one company. The specialization of different regions in different stages of the production process. Spatial Division of Labor Externalities The stage of transportation when a large shipment is broken into smaller lots and/or different modes of transportation. Break of Bulk

A numerical relationship showing the number of total jobs created for each new basic job in a region. Regional Multiplier An export assembly plant in Mexico that relies on cheap labor to assemble imported components that are then re- exported as finished goods. Maquiladora A demand-driven model in which exports to other regions drive regional development. Economic Base Model An industrial location strategy that seeks to minimize what the firm pays to produce and distribute its products or services. Cost Minimization

The tendency for an industry to locate near the source of raw materials in order to save on transport costs, which usually occurs when raw materials lose weight in the production process. Raw Material Oriented The tendency for an industry to locate near population centers in order to save on transport costs, which usually occurs when the final product is more expensive to transport than the raw materials. Market Oriented Lower production costs as a result of larger volume of production. Economies of Scale Cost savings resulting from location near other firms. Agglomeration Economies

Savings resulting from locating in or near urban areas that have a large and diverse labor pool, large markets, developed infrastructure, and availability of a wide variety of goods and services. Urbanization Economies Savings resulting from local specialization in a particular industry. Localization Economies An industry producing goods or services for sale within the local region. Nonbasic Industry An industry producing goods or services for sale to other regions. Basic Industry An arrangement in which a service or a manufacturing process that was previously produced in-house is subcontracted to an outside company. Outsourcing

Help Wanted: The Changing Geography of Jobs Kuby 6 Case Study

After completing this chapter, you will be able to: Differentiate among primary, secondary, tertiary, and quaternary activity Explain how and why certain kinds of economic activities minimize certain kinds of costs. Identify and explain employment patterns on maps. Define the economic specializations of your state or province in relation to the nation, and understand why those specializations exist.

After completing this chapter, you will be able to (cont’d): Describe how your state’s or province’s economic profile has changed over time. Differentiate between basic and nonbasic activity. Calculate a regional multiplier from the ratio of total to basic activity.

Figure 6.8 (p. 152) Background on Economic Restructuring of the U.S. and Canadian Economies Job Competition

Figure 6.10 (p. 154) Structural change of the economy

(p. 179) Activity 2: Regional Multipliers 2.1, p. 181:K = 100/400 = 2.5 Complete Kuby 6 Activities 1&2 by Thursday

Table 6.2 (p. 162) Activity 1: Regional Econ. Specialization U.S State and National Employment Percentages by Industry, 2000

Figure 6.12a (p. 166)

Figure 6.12b (p. 166)

Figure 6.12c (p. 167)

Figure 6.12d (p. 167)

Figure 6.12e (p. 168)

Figure 6.12f (p. 168)

Figure 6.12g (p. 169)

Figure 6.12h (p. 169)

Figure 6.12i (p. 170)

Figure 6.12j (p. 170)

Figure 6.12k (p. 171)

Figure 6.12l (p. 171)

Figure 6.12m (p. 172)

(p. 173) States with cities that have a population greater than 2.35 million

Table 6.4 (p. 174) U.S State and National Employment Percentages by Industry, 1969 USA, 1969ALAKAZARCACOCTDEDCFLGAHIID Primary 11 Agriculture, forestry, fishing and hunting Mining and oil and gas extraction Secondary 23 Construction Manufacturing* Tertiary 22,41,48,49 Pub util, wholesl, transp, warehse* Retail trade* Information* Finance, insurance, and real estate Producer services* Educational services* Health care and social assistance* Arts, ent, recr, lodging, & food svcs* Public administration ILINIAKSKYLAMEMDMAMIMNMSMO Primary 11 Agriculture, forestry, fishing and hunting Mining and oil and gas extraction Secondary 23 Construction Manufacturing* Tertiary 22,41,48,49 Pub util, wholesl, transp, warehse* Retail trade* Information* Finance, insurance, and real estate Producer services* Educational services* Health care and social assistance* Arts, ent, recr, lodging, & food svcs* Public administration