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Economic Activities: Definition & Classification

Instructor: Amy C. Evans

Amy has a BA/MA Criminal Justice. Worked with youth for over 20 years in academic settings. Avid reader, history and mystery lover.

Economic activities provide employment, wages, and products and services throughout the world. In this lesson, we will define the concept of economic activity and explore how these activities are classified. Updated: 08/20/2021

Economic Activities

What do you do to support yourself? What allows you to buy products and engage services? For many of us, the answer is conducting some sort of economic activity, which is an activity that allows us to earn monies in the form of a wage or salary, that we, in turn, use to pay our rent, buy our groceries and have someone dry clean our clothes. After meeting our basic needs, if there is money left over, we might indulge in something fun, such as eating out, going to the movies, or making an expensive purchase of a luxury item, like a large-screen smart tv.

We are all laborers and consumers and our economic activities create economic activities in different sectors of society, creating a kind of loop as we create, sell, and buy. Let us take a closer look at how economic activities are classified.

Classification of Economic Activities

Primary Economic Activities

Primary economic activities are centered on resources available in our physical environment. Resources include rich soil for agriculture, timber, minerals, and water. People who work in primary economic activities are sometimes called ''red collar'' workers. Employment in primary economic activities includes farming and livestock management, mining, log cutting, and fishing.

Farming is a primary sector activity
Primary sector activity

Secondary Economic Activities

Secondary economic activities are centered on processing and manufacturing the raw materials the primary economic activities produce and constructing buildings, bridges, roads, other public and private projects using these materials. Wheat needs to be processed into flour or grain for animals, timber needs to be cut and shaped for construction, iron has to be smelted, domestic farm animals must be slaughtered, packaged, and transported to the grocery store, fish need to be smoked or packaged and sent to stores and restaurants, and the material dug and cut out of mines must be transformed into useable forms such as copper wiring and diamonds for the tip of drills. People who work in secondary economic activities are also called ''blue collar'' workers.

Iron ore is smelted by blue-collar workers who take iron ore and heat it up to extract the metal so it can be used in construction
Iron smelting is a secondary economic activity

Tertiary Economic Activities

Tertiary economic activities are frequently referred to as ''white collar'' jobs. These are jobs that provide some kind of service, such as retail businesses, transportation jobs, and journalism.

Two subclassifications related to tertiary economic activities are:

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