Industries

The 19th (1800’s) century brought change:

Production of items became mechanized. Factories produced a growing number of goods. Quantities of goods produced increased. People left the countryside to move closer to the

factories in towns and cities (urbanization).

During the 20th (1900’s) century…

Industry (mass produced in factories) replaced farming and hand manufacture (goods made by hand).

An activity is “industrial” when…1. Transforms a natural resource into mass-produced

good.

2. Costs money to manufacture these items.

3. Requires skilled workers.

What do industries produce?

Almost everything around us is manufactured industrially, from airplanes to clothes, including medicines and computers.

4 Types of Industries1. Heavy industry: • It involves extracting metals or valuable minerals (ex: iron,

aluminium, copper, tin and lead) from ore.

(Ore a naturally occurring solid material – rock- from which a metal or valuable mineral can be profitably extracted.)

• It also includes chemical plants and oil refineries.

2. Processing industry:• Transforms materials (metal, food, wood, etc.) into

goods (motors, plastic, paper, etc.).

3. Hi-tech industry:

• These include all products manufactured in pharmaceuticals, biotechnology, computers and electronics, aerospace, and telecommunications.

4. Consumer goods industry:

Manufactures products such as processed foods, clothing, house-hold appliances, cars, furniture and toys (for individual consumption).

What is a industrial park?

• It is an area of land developed as a site for factories and other industrial businesses.

Characteristics of industrial parks:

1. Cluster (group) of industries in this area.

2. Roads (18-wheelers) and a rail network (trains) for transporting raw materials and finished products to and from the factories.

3. A seaport and an airport are nearby for exporting and importing products.

4. Hydro lines that reach the factories to provide energy.

5. Enough people to operate the factory.

Are industries in the North or the South?

Some of the wealthy countries that are usually present at G7 or G20 meetings:

• United States• Japan• Germany• United Kingdom• France• Canada • Italy

Wealth distribution

The 10 companies with the highest sales in

2014

http://money.cnn.com/magazines/fortune/global500/2013/full_list/

Which company ranked first place in the highest sales 2013-4? – Fortune 500 (source)

Industrialization around the world

• The European Union, North America and Japan are highly industrialised.

• Other countries, like China, India, South Korea, Singapore and Taiwan are considered “emerging industrial powers”.

American Toys – Made in China:

Case Study Barbie dolls are made by Mattel.

Mattel is a multinational company based in the United States (head office).

The dolls, however, are made in Chinese factories!

Why?

1. Reduce production costs

2. Increase profits by cutting on production costs

MULTINATIONAL = MANY COUNTRIES

These multinationals relocate to other countries where the cost of production is lower than in developed countries like Canada or U.S.A.

Mattel Toy factory in the 1950’s

http://www.youtube.com/watch?v=fv_lPfbKxEQ

How Toys Are Made - Jakks Pacific Toy Design Studio Tour

• http://www.youtube.com/watch?v=CYqSGXeT59k

Why move U.S.-based companies to China?

1. Chinese workers are paid less.

2. Chinese government offers better rates on buying and transporting raw materials and energy.

3. American companies pay less taxes and do not pay any duty fees.

Making dolls is an international effort!• China offers manufacturing site, labour, and electricity.

• Japan provides nylon (doll's hair).

• Saudi Arabia offers oil.

• Taiwan transforms oil to ethylene to make plastic.

• U.S.A. and Japan manufacture most of the machinery and tools used to produce goods.

Is “off shoring” good for everyone?

• Relocating production to another country is called “off shoring/outsourcing”.

• Off shoring is closing down a manufacturing plant in America and reopening it in a foreign country.

FAVOR• Companies like Mattel (investors, CEO, etc.) benefit

from off shoring because it increases their profits.

• Chinese government is in favor of it because it has created millions of jobs.

However...

https://www.youtube.com/watch?v=Q9sORKPp_bE

https://www.youtube.com/watch?v=NHamIjw11BQ

• American employees are against off shoring because it means job losses in the United States.

• The Mattel factory in Kentucky closed down in 2002.

• Humanitarian organizations have noted that “off shoring” to developing countries can sometimes lead to bad working conditions.

This is outsourcing… •Imagine you have a company that sells mobile phones, and you have a help center. People can call if they have a problem, and they will get answers to how to use their phone. • •Where you live, the minimum wage is $12 an hour. That means the people who answer the phones and give help have to be paid at least $12 an hour to answer the phones and give help to people who call. • •What if, instead of having those people in the same city as the people who call for help, you have them in a city in India? When people who call for help dial the HELP number, their call goes to India. The person who answers the call speaks good English, knows all the answers, and the customer is satisfied. As far as the customer is concerned, it could have been a local number. • •The thing is, you are only paying the person in India $4 an hour. Everyone is happy, but you are saving $8 an hour. Your business is running smoothly, but it is being handled somewhere else, somewhere cheaper. • •http://answers.yahoo.com/question/index?qid=20110319200655AA7MlHa

The Great Lakes automotive industry: What of its future?

• American car companies are concentrated in the Great Lakes region.

• Detroit is home to General motors, Ford and Chrysler.

Canada's automotive industry

• Most factories are in Ontario between Windsor and Oshawa.

En route to… relocation

• Japan is a fierce competitor in the automotive industry.

• Since the 1960s, the rise of Japanese car companies (Toyota, Nissan and Honda) has affected the sales of American made cars.

• Japanese cars were more compact (smaller) and consumed less gas.

• GM, Ford and Chrysler made the decision to offshore (relocate its companies to Mexico in order to remain competitive with Japan by lowering their production costs).

• Relocating to Mexico meant closing many factories in the United States and Canada.

General Motors, Ste-Thérèse (the end)

A monthly union meeting of former GM employees, TCA local 1163, in their spaces in the town of Boisbriand — despite the plant’s closing, bringing thirty years’ operation and Quebec’s automotive industry to an end. The parking lot storing the last Impalas, the only view one has of the production as access to the manufacturing premises was denied. We’re on the outside, and that’s where we’ll stay, the factory having been torn down.

2004 Working, Mercer Union, Toronto.

The case of Detroit• It was once the automotive capital of the United States.

• Relocating factories to Mexico really affected the Great Lakes region.

• The region still manufactures cars however, it has reorganized production by installing technology that reduces the number of employees (labor) and making cars that sell really well in America.

Fault Lines: Collapsing Auto Industry in Detroit

• http://www.youtube.com/watch?v=9TSITIsK4eQ

http://www.youtube.com/watch?v=lEXLPpr2Rwg

How the American dream went wrong in Detroit