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What Is an Industry? An industry is a group of companies that are related based on their primary business activities. In modern economies, there are dozens of industry classifications, which are typically grouped into larger categories called sectors. Individual companies are generally classified into an industry based on their largest sources of revenue. For example, while an automobile manufacturer might have a financing division that contributes 10% to the firm’s overall revenues, the company would be classified in the automaker industry by most classification systems. Industry, a group of productive enterprises or organizations that produce or supply goods, services, or sources of income. In economics, industries are customarily classified as primary, secondary, and tertiary; secondary industries are further classified as heavy and light. Primary industry – This sector of a nation’s economy includes agriculture, forestry, fishing, mining, quarrying, and the extraction of minerals. It may be divided into two categories: genetic industry, including the production of raw materials that may be increased by human intervention in the production process; and extractive industry, including the production of exhaustible raw materials that cannot be augmented through cultivation.The genetic industries include agriculture, forestry, and livestock management and fishing—all of which are subject to scientific and technological improvement of renewable resources. The extractive industries include the mining of mineral ores, the quarrying of stone, and the extraction of mineral fuels.Primary industry tends to dominate the economies of undeveloped and developing nations, but as secondary and tertiary industries are developed, its share of the economic output tends to decrease. Secondary industry – This sector, also called manufacturing industry, takes the raw materials supplied by primary industries and processes them into consumer goods, or further processes goods that other secondary industries have transformed into products, or builds capital goods used to manufacture consumer and nonconsumer goods. Secondary industry also includes energy-producing industries (e.g., hydroelectric industries) as well as the construction industry. Secondary industry may be divided into heavy, or large-scale, and light, or small-scale, industry. Large-scale industry generally requires heavy capital investment in plants and machinery, serves a large and diverse market including other manufacturing industries, has a complex industrial organization and frequently a skilled specialized labour force, and generates a large volume of output. Examples would include petroleum refining, steel and iron manufacturing, motor vehicle and heavy machinery manufacture, cement production, nonferrous metal refining, meat-packing, and hydroelectric power generation.Light, or small-scale, industry may be characterized by the nondurability of manufactured products and a smaller capital investment in plants and equipment, and it may involve nonstandard products, such as customized or craft work. The labour force may be either low skilled, as in textile work and clothing manufacture, food processing, and plastics manufacture, or highly skilled, as in electronics and computer hardware manufacture, precision instrument manufacture, gemstone cutting, and craft work. Tertiary industry – This sector, also called service industry, includes industries that, while producing no tangible goods, provide services or intangible gains or generate wealth. In free market and mixed economies this sector generally has a mix of private and government enterprise.The industries of this sector include banking, finance, insurance, investment, and real estate services; wholesale, retail, and resale trade; transportation, information, and communications services; professional, consulting, legal, and personal services; tourism, hotels, restaurants, and entertainment; repair and maintenance services; education and teaching; and health, social welfare, administrative, police, security, and defense services. An industry is the production of goods or related services within an economy.The major source of revenue of a group or company is the indicator of its relevant industry. When a large group has multiple sources of revenue generation, it is considered to be working in different industries. Manufacturing industry became a key sector of production and labour in European and North American countries during the Industrial Revolution, upsetting previous mercantile and feudal economies. This came through many successive rapid advances in technology, such as the production of steel and coal .Following the Industrial Revolution, possibly a third of the economic output comes from manufacturing industries. Many developed countries and many developing/semi-developed countries (China, India etc.) depend significantly on manufacturing industry. The manufacturing or technically productive enterprises in a particular field, country, region, or economy viewed collectively, or one of these individually. A single industry is often named after its principal product; for example, the auto industry. For statistical purposes, industries are categorized generally according a uniform classification code such as Standard Industrial Classification (SIC). Any general business activity or commercial enterprise that can be isolated from others, such as the tourist industry or the entertainment industry. Heavy Industry Heavy industry is industry that involves one or more characteristics such as large and heavy products; large and heavy equipment and facilities (such as heavy equipment, large machine tools, huge buildings and large-scale infrastructure); or complex or numerous processes. Because of those factors, heavy industry involves higher capital intensity than light industry does, and it is also often more heavily cyclical in investment and employment. Transportation and construction along with their upstream manufacturing supply businesses have been the bulk of heavy industry throughout the industrial age, along with some capital-intensive manufacturing. Traditional examples from the mid-19th century through the early 20th included steelmaking, artillery production, locomotive erection, machine tool building, and the heavier types of mining. From the late 19th century through the mid-20th, as the chemical industry and electrical industry developed, they involved components of both heavy industry and light industry, which was soon also true for the automotive industry and the aircraft industry. Modern shipbuilding (since steel replaced wood) is considered heavy industry. Large systems are often characteristic of heavy industry such as the construction of skyscrapers and large dams during the post–World War II era, and the manufacture/deployment of large rockets and giant wind turbines through the 21st century. Many East Asian countries rely on heavy industry as key parts of their overall economies. This reliance on heavy industry is typically a matter of government economic policy. Among Japanese and Korean firms with “heavy industry” in their names, many are also manufacturers of aerospace products and defense contractors to their respective countries’ governments such as Japan’s Fuji Heavy Industries and Korea’s Hyundai Rotem, a joint project of Hyundai Heavy Industries and Daewoo Heavy Industries. Heavy industries often sell their products to other industries rather than to end users and consumers. In other words, they usually make products that are used to make other products. Accordingly, when a down economy begins to recover, heavy industry is often first to show signs of improvement. This makes the sector a leading economic indicator.Oil, mining, shipbuilding, steel, chemicals, machinery manufacturing and similar industries are examples of heavy industry. They are very capital-intensive, meaning that they require a lot of machinery and equipment to produce. Often, they are criticized for their environmental impacts.
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