UNIT 12 CATEGORILLA TOP TEN MOST and LEAST SERVICE-ORIENTED ECONOMIES

GROUNDING THINGS TO REMEMBER SECTORS OF THE ECONOMY SECTOR SHIFT WITH DEVELOPMENT

GROUNDING SERVICES SERVICES are economic activities that fulfill a human want/need in exchange for payment Services are located in SETTLEMENTS (a permanent collection of buildings where a population lives, works and gets services). Services tend to comprise more than 66% percent of MDC GDP, but less than 50% in most LDCs CONSUMER SERVICES BUSINESS SERVICES PUBLIC SERVICES The service sector of the economy is divided into three types:

GROUNDING ORIGIN OF SETTLEMTNTS Like agriculture, CIVILIZATION itself (the concentration of populations into permanent settlements) is thought to have occurred independently in a number of places. Mesopotamia (3500 BCE)Nile Valley (3200 BCE)Indus Valley (2200 BCE)Huang Ho (1500 BCE)Mesoamerica (200 BCE) Once humans established permanent settlements, those settlements also began to provide consumer (burial, housing, tools, clothing, containers, fuel, etc.) and public services (religion, government and military) to inhabitants and other in surrounding regions

GROUNDING SERVICES Each branch of the service sector is then divided into types: CONSUMER SERVICES BUSINESS SERVICES PUBLIC SERVICES Provides services to individual consumers Comprises 44% of US jobs Retail/wholesale service (15%) Education Service (10%) Health Service (12%) Leisure/Hospitality service (10%) Services that facilitate other businesses Comprises 24% of US jobs Professional services (12%) Financial services (F.I.RE 6%) Transpo/info/utility services (6%) Provide security and protection to citizens and businesses Comprises 17% of US jobs Federal Government State Government Local Government Primary/Secondary sector work in the US has declined since the 1970s Healthcare, education, entertainment and recreation have seen increases (not retail) Increases in engineering, law, management, advertising, data processing (not finance) Government, military and law enforcement tend to remain stable

GROUNDING SERVICES Each branch of the service sector is then divided into types: CONSUMER SERVICES BUSINESS SERVICES PUBLIC SERVICES Provides services to individual consumers Comprises 44% of US jobs Retail/wholesale service (15%) Education Service (10%) Health Service (12%) Leisure/Hospitality service (10%) Services that facilitate other businesses Comprises 24% of US jobs Professional services (12%) Financial services (F.I.RE 6%) Transpo/info/utility services (6%) Provide security and protection to citizens and businesses Comprises 17% of US jobs Federal Government State Government Local Government Primary/Secondary sector work in the US has declined since the 1970s Healthcare, education, entertainment and recreation have seen increases (not retail) Increases in engineering, law, management, advertising, data processing (not finance) Government, military and law enforcement tend to remain stable

GROUNDING US AND GLOBAL IMPACT OF RECESSION The Service sector has been the growth engine for the economies of MDCs. Ironically, the service sector also triggered the global recession than began in 2008: Rapid rise in real estate values encourages speculation Poor lending practices in form of subprime mortgages Risky financial practices like derivatives and speculation gov deregulates financial institutions (bad idea) Lending institutions don’t make new loans after recession

GROUNDING MOST SERVICE ORIENTED (service as % of GDP) 10. SWEDEN (71.5%) 9. NETHERLANDS (72.5%) 8. ITALY (73.1%) 7. JAPAN (73.8%) 6. DENMARK (76.1%) 5. UNITED STATES (76.8%) 4. BELGIUM (77.4%) 3. UNITED KINGDOM(77.5%) 2. GREECE (78.5%) 1. FRANCE (79.5%)

GROUNDING LEAST SERVICE ORIENTED (service as % of GDP) 10. ALGERIA (30.2%) 9. GUINEA (28.5%) 8. IRAQ (27.3%) 7. BRUNEI (25.3%) 6. CEN AFRICAN REP (25%) 5. SOMALIA (25%) 4. ANGOLA (24.6%) 3. QATAR (21.1%) 2. SIERRA LEONE (21%) 1. LIBERIA (17.7%)