What Is the Definition of Tertiary Industry

There is considerable controversy among economists about the appropriate role of the tertiary sector and the industries it encompasses in a maturing economy. As the primary sector consolidates and globalizes, and the secondary sector loses jobs to cheaper labour in developing countries, the workers they move tend to work in generally lower-paid jobs in the tertiary sector, raising questions about the quality of life of future generations. Traditional hotels such as hotels and resorts are just as much a part of the tertiary industry as food service providers such as restaurants. All services used by financial institutions such as banks and investment intermediaries are also tertiary in nature. Service providers face barriers to selling services that sellers of goods rarely face. The services are intangible, making it difficult for potential customers to understand what they will receive and what value it will have for them. In fact, some, such as advisors and investment service providers, do not offer value-for-money guarantees. Over the past 100 years, developed countries have moved significantly from the primary and secondary sectors to the tertiary sector. This change is called tertiarization. [2] The tertiary sector is now the largest economic sector in the Western world and also the fastest growing sector.

Looking at the growth of the service sector in the early nineties, globalist Kenichi Ohmae noted that some observers have found that the service sector has two components: one involved in the delivery of tangible goods, and the other involved in the delivery of intangible goods – things like education, healthcare, financial services, and entertainment. These are all services whose value is difficult to determine, but overall, these industries account for a significant percentage of the economy, which is why the tertiary sector is often referred to as the service sector. Companies in this sector are rapidly becoming more focused on what is increasingly being called the knowledge economy, or on the ability to outperform their competitors by understanding what target customers want and need, and working in a way that meets those wants and needs quickly and at minimal cost. Although they are all oriented towards services, such as the tertiary sector, these services have been separated and divided into the quaternary industrial sector. The economic structure of a country generally changes from the primary sector to the secondary sector and then to the tertiary sector. Traditional economies tend to depend on the primary sector. Then, as the economy grew and industrialization progressed, the secondary and tertiary sectors began to play more roles. The tertiary industrial sector includes the provision of services to other enterprises as well as to final consumers. Services may include the transportation, distribution and sale of goods from farm to fork, as may be the case in wholesale, retail, pest control or entertainment. Goods can be transformed in the process of providing the service, as is the case in gastronomy.

However, the focus is on people interacting with people and serving the customer, rather than transforming physical goods. If the economy is doing badly, employment in one service sector may be more vulnerable than in others, but this is not a hard and fast rule. Education is a tertiary sector whose employment and other indices of economic activity will be more sensitive to changes in the population of school-age children than, for example, the stock market. Travel and entertainment, on the other hand, is a tertiary industry that is highly vulnerable to overall economic performance. As confidence in economic performance declines, consumers will forgo discretionary spending and instead save for proverbial rainy days. Some technology services were previously considered tertiary, although some found it appropriate to place them in a new segment due to industry growth. These technology services include telecommunications service providers, cable companies and Internet service providers. The tertiary industry provides services as well as operational framework conditions for business operations.

These may be organizations in the shipping and transportation industry, such as railways or trucks, where the focus is solely on the freight process. It could also include passenger transportation such as taxi services, transit bus systems and subways.