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Martin has 16 years experience in Human Resources Information Systems and has a PhD in Information Technology Management. He is an adjunct professor of computer science and computer programming.
Businesses produce all sorts of goods and services. These businesses operate in a given number of industries. An industry defines what types of production is being done and helps us classify the various businesses and services. Until recently, we only organized businesses into three main industries and labeled them primary, secondary and tertiary.
Primary industry is focused on producing raw materials such as farming, mining, or fishing. Secondary industries are focused on converting the raw materials into usable products. Businesses in the tertiary sector are focused on service delivery (bankers, solicitors, or retailers).
These three industry labels have served economists well. However, we now realize that there are two more industry sectors in which businesses belong: quaternary and quinary. This is because of the rapid growth of service-based businesses. Around three-fourths of all employees work in the service industry. Let's use an analogy involving buckets.
Because most advanced economies are now service-based, it doesn't make sense to force everything into one bucket when we can add more buckets. Business in the quaternary sector focuses on the processing and transfer of information as knowledge. This includes computing, telecommunications, and education. The fifth sector, the quinary sector, focuses on domestic services that were once done in the home. We'll get to the details shortly. First, let's consider the chart on your screen (below) that describes the different industry sectors.
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This graphic shows another way to look at the quinary industry sector, where the quaternary and quinary sectors branch from tertiary:
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The fifth sector, the quinary sector, consists of domestic services. These are services that were once completed by an individual in his or her home. The quinary sector is growing, while in Australia, for example, we are seeing a decline in the primary sector. Breaking down the tertiary sector into quaternary and quinary sectors really helps us see where the growth is coming. Remember that quaternary businesses include education, information technology, and professional services.
Quinary jobs include the following:
If we look at employment numbers from early 2016, we see that the quinary sector takes up 26% of jobs. We've seen a large increase in domestic services, hotels, and restaurants. Restaurants have always existed, but cooking is technically a domestic activity. Now that we have the five sectors to analyze, it helps economists, investors, and employers see where the trends are.
As the economy evolves, we can no longer classify businesses into three sectors of industry, which defines what types of production is being done and helps us classify the various businesses and services. An industry is a categorization of a business that tells us the type of goods or services that business produces. Apart from the sectors like primary, or production of raw materials, secondary, or converting the raw materials into usable goods, and tertiary, focused on service delivery, we now have quaternary and quinary sectors defined. The quaternary sector means fourth, and focuses on the processing and transfer of information as knowledge. Quinary simply means fifth. It consists of services once performed in the home, or domestic services. Chefs, daycare providers, and cleaning services are types of quinary businesses.
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HSC Business Studies: Exam Prep & Syllabus37 chapters | 244 lessons | 31 flashcard sets
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