Economic Sectors Definition

Imagine some of the different jobs undertaken to make it

possible for you to use the electronic device that you are
now using. First, miners had to extract minerals from the
Earth for many of the parts of the device. Later, these
minerals were transformed by factory workers into electronic
components such as computer chips. Then, various people
employed in services, such as delivery truck drivers, helped
get the device to you and other customers. Before your
device was even made, people involved in product
development at the electronics company designed how your
device would work and look. Then there are also the top
executives at the company making important and costly
decisions. Each type of work just discussed is one example of
a job from a different economic sector.
An economic sector is a part of the economy where a
particular business activity is undertaken.
Economic Sectors Classification
There are thousands of different jobs performed by people
around the world, contributing to the modern global
economy. To better make sense of how different types of
work contribute to economic development and trade, these
jobs can be classified into one of five economic sectors.
These sectors are the primary sector, secondary sector,
tertiary sector, quaternary sector and quinary sector.

Sector Activity
Primary Work performed in the primary sector
Sector produces raw materials and agricultural
goods. It includes jobs in farming, mining,
fishing, and forestry.
Secondary Secondary sector jobs involve turning raw
Sector materials into more valuable,
manufactured items. Typically, these jobs
are done in factories.
Tertiary Sector Tertiary sector jobs do not actually produce
anything, but instead, involve people
providing services to others. This can be
anything from a taxi driver to a nurse.
Quaternary Most of the jobs in this sector are also
Sector services but require more education and
expertise than tertiary jobs. Included are
Information Technology professionals,
stockbrokers, and product developers.
Quinary Sector
Within this sector, government officials, top executives at
large corporations, and research scientists are typically
found, as well as the police, the military, and even non-profit
organisations or charities.

Classifying these sectors is part of the process of economic

sector classification. The five economic sectors divide up all
economic activity based on the type of work performed and
the goods and services produced. The number of sectors
grew as new types of work developed, and economists
defined new sectors. For this reason, you still find many
websites and books that only divide economic activity into
the first three sectors and do not mention the more recently
developed quaternary or quinary sectors. Overall, as places
become more economically developed, they move away
from primary sector employment to jobs done higher "up the
chain". Primary sector jobs are some of the earliest ever
done by people, while most quaternary and quinary sector
jobs came into existence relatively recently.
Economic Sectors Examples
There are many different examples of the work included in
each of the economic sectors. Let's explore this further.
The Primary Sector
Examples of the primary sector include economic activities
that involve extracting or producing raw materials directly
from the earth. Food production work such as farming,
fishing, and ranching are included in the primary sector.
Other industries include mining, quarrying, drilling for
resources, forestry, harvesting, and hunting.
In general, goods produced in the primary sector are less
valuable than manufactured goods (produced in other
sectors, but we'll talk about this later). Countries with many
people working in the primary sector tend to be the least
economically developed. There are some exceptions, though.
Countries, where significant amounts of petroleum (oil) and
natural gas are extracted, may have a high level of economic
development because of the importance of these two
primary goods as energy sources, yet still have a primary
sector-based economy. Similarly, precious gems, such as
diamonds and emeralds, are quite valuable because of their
scarcity and demand for them.
The Secondary Sector
Secondary sector jobs increased rapidly after the Industrial
Revolution. Secondary sector activities are those that involve
manufacturing and construction. Factory work that involves
the production of goods, such as automobiles, furniture,
cloth, and steel, would all be examples of secondary sector
activities. Construction is also included; this is essentially the
manufacturing of buildings and other structures. Some
secondary sector activities produce items used by others
also in the secondary sector. For example, steel made in
steel mills is then sent to a factory to be used in the
production of aeroplanes.
Secondary sector goods vary widely in value, and countries
often begin manufacturing simpler, less valuable items
before they begin to develop economically. Often the
clothing and textile industries first appear in a country
before more complex ones, such as automobile or
electronics production. A great example of this is Japan,
which started off with the textile industry and then moved on
to car production.
The Tertiary Sector
Many of the service jobs that are in abundance in
economically developed countries are examples of tertiary
sector economic activity. Most people you interact with every
day are employed in the tertiary sector. Bus drivers,
restaurant workers, salespeople, and pharmacists all work in
the tertiary sector. We'll go into more detail about the
tertiary sector later on.
The Quaternary Sector
The quaternary sector was defined more recently as new
types of jobs became increasingly based on the knowledge
people can provide to others. For quaternary sector
economic activities, the specialised knowledge of the worker
is the product. For the most part, these are jobs that seem
similar to tertiary sector jobs, so differentiating between the
two sectors can be difficult. Someone working in a shoe store
clearly has knowledge about the shoes being sold, but this
knowledge isn't what is actually being sold. This person
works in the tertiary sector. On the other hand, a person who
helped to design the shoe is mainly providing their
knowledge and performing work in the quaternary sector.
Jobs in fields such as IT programming, consulting and
financial services are also examples of quaternary sector
economic activities. Most jobs in the quaternary sector
require high levels of formal education at universities and
graduate schools. The quaternary sector grows in
economically developed countries where access to these
educational institutions is readily available.
The Quinary Sector
The quinary sector is a further advancement of the tertiary
sector or a further breakdown of the quaternary sector.
Theorists say this sector is dedicated to the highest level of
certain services or parts of the knowledge economy, such as
the government, universities, and healthcare. These are also
typically the services that are non-profit, meaning they
aren't existing to make money but instead are there to serve
the public good, such as the military, police, fire
departments etc. This sector can also include non-profit
organisations, like NGOs or other smaller-scale charities.
Other activities included in the quinary sector are things like
childcare, nursing homes or housekeeping.
Tertiary Economic Sector
Employment in the tertiary sector tends to grow after
countries have industrialised and experienced more
economic development. Service jobs replace jobs in the
secondary sector as places experience deindustrialisation or
jobs in factories move to other countries. Some jobs in
services do not require much formal education, but most do
require people to be more literate and have a wider range of
skills than in the secondary sector. As countries introduce
universal education, the growth of service jobs tends to
follow.
Deindustrialisation is when industrial activity goes down.
The percentage of people working in service jobs grew
rapidly during the twentieth century, especially in more
economically developed countries that had industrialised the
earliest. As a country develops further, the tertiary sector
will typically grow whilst the primary sector reduces. Most
people you know will work in the tertiary sector; whether
you've gone to get your hair cut or you're undergoing a
medical procedure, you're being served by the tertiary
sector.
The tertiary sector can be both profit and non-profit.
Profitable services include those which are paid for by a
consumer, such as financial services, hotels, haircuts etc.
Non-profit services include things like public education
provided by the state (not private education). In 2020, the
service sector contributed a huge 65.73% to the global Gross
Domestic Product (GDP).1
Five Economic Sectors
So, time for a memory refresh! Economic sectors are parts of
the global economy where different types of work are
undertaken. There are five main economic sectors.
 Primary Sector - raw materials.
 Secondary Sector - manufacturing.
 Tertiary Sector - services.
 Quaternary Sector - knowledge.
 Quinary Sector - an extension of the
tertiary/quaternary sector.
 Typically, more developed countries have less economic activity
(people employed) in primary or secondary sectors. Take a look
at the model below. It shows that over time (and we can assume
as a country develops), primary activities go down, whilst tertiary
activities go up. When deindustrialisation hits, secondary
 activities reduce too. Quaternary sectors begin to develop later in
time.

Economic Sectors - Key takeaways
 Economic sectors are parts of the economy where
different jobs take place.
 There are 5 main sectors of the economy, categorised
by the economic sector classification.
 The 5 sectors are: primary, secondary, tertiary,
quaternary, and quinary,
 Primary activities are typically found in less developed
countries or those which export valuable products like
oil.
 As a country develops, it's typically seen that primary
and secondary sectors go down, whilst tertiary and
eventually quaternary sectors increase.
 The tertiary industry is the largest sector worldwide,
accruing the highest global GDP in 2020.