Globalisation
The Clark Fisher Model
Two economists, Clark and Fisher, produced a model which can help to explain changes in employment structures.
As countries develop, Clark and Fisher said they go through three stages:
Pre Industrial
Low Income Countries (LIC's) are dominated by primary production as they don't have the money to produce technological advancements necessary to change dominant employment types.
Industrial
Middle Income Countries (MIC's) are dominated by the secondary sector. These countries have a declining primary sector and a steadily increasing tertiary sector. As the economies develop and income rises, the demand for manufactured goods increases.
Post Industrial
High Income Countries are dominated by the tertiary sector as secondary industries decline and primary employment is almost non-existant. This occurs because the economy continues to rise, people consume more and more and therefore require the services.
Quaternary jobs start to develop as they gain support and promotion from the tertiary sector.
Industry provides employment, and they both can be split into four main categories:
Primary-people extract raw materials from the land or sea. Farming, fishing and mining are examples.
Secondary-people are involved in manufacturing, where raw materials are converted into a finished product, for example house building, car making or steel processing.
Tertiary-provide a service. there is a wide range of service industries, including distribution, retailing, financial, education and medical.
Quaternary-provide information and expert help. They are often associated with creative or knowledge-based industries, for example IT, biosciences, media etc.
Globalisation is the process by which the world is becoming increasingly interconnected as a result of massively increased trade and cultural exchange.
Globalisation has resulted in:
• increased international trade
• a company operating in more than one country
• greater dependence on the global economy
• freer movement of capital, goods, and services
• recognition of companies such as McDonalds and Starbucks in LEDCs
Although globalisation is probably helping to create more wealth in developing countries - it is not helping to close the gap between the world's poorest countries and the world's richest.
There are several key factors which have influenced the process of globalisation:
Improvements in transportation - larger cargo ships mean that the cost of transporting goods between countries has decreased. Economies of scale mean the cost per item can reduce when operating on a larger scale. Transport improvements also mean that goods and people can travel more quickly.
Freedom of trade - organisations like the World Trade Organisation (WTO) promote free trade between countries, which help to remove barriers between countries.
Improvements of communications - the internet and mobile technology has allowed greater communication between people in different countries.
Labour availability and skills - countries such as India have lower labour costs (about a third of that of the UK) and also high skill levels. Labour intensive industries such as clothing can take advantage of cheaper labour costs and reduced legal restrictions in LEDCs.