In macroeconomics, the secondary sector of the economy is an

economic sector One classical breakdown of economic activity distinguishes three sectors: * Primary: involves the retrieval and production of raw-material commodities, such as corn, coal, wood or iron. Miners, farmers and fishermen are all workers in the p ...

in the three-sector theory that describes the role of

manufacturing Manufacturing is the creation or production of goods with the help of equipment, labor, machines, tools, and chemical or biological processing or formulation. It is the essence of secondary sector of the economy. The term may refer to ...

. It encompasses industries that

produce Produce is a generalized term for many farm-produced crops, including fruits and vegetables ( grains, oats, etc. are also sometimes considered ''produce''). More specifically, the term ''produce'' often implies that the products are fres ...

a finished, usable product or are involved in

construction Construction is a general term meaning the art and science to form objects, systems, or organizations,"Construction" def. 1.a. 1.b. and 1.c. ''Oxford English Dictionary'' Second Edition on CD-ROM (v. 4.0) Oxford University Press 2009 and ...

. This sector generally takes the output of the

primary sector The primary sector of the economy includes any industry involved in the extraction and production of raw materials, such as farming, logging, fishing, forestry and mining. The primary sector tends to make up a larger portion of the economy ...

(i.e.

raw material A raw material, also known as a feedstock, unprocessed material, or primary commodity, is a basic material that is used to produce goods, finished goods, energy, or intermediate materials that are feedstock for future finished products. As feeds ...

s) and creates finished goods suitable for sale to domestic

business Business is the practice of making one's living or making money by producing or buying and selling products (such as goods and services). It is also "any activity or enterprise entered into for profit." Having a business name does not separ ...

es or

consumer A consumer is a person or a group who intends to order, or uses purchased goods, products, or services primarily for personal, social, family, household and similar needs, who is not directly related to entrepreneurial or business activities. ...

s and for

export An export in international trade is a good produced in one country that is sold into another country or a service provided in one country for a national or resident of another country. The seller of such goods or the service provider is a ...

(via distribution through the tertiary sector). Many of these industries consume large quantities of energy, require factories and use machinery; they are often classified as

light Light or visible light is electromagnetic radiation that can be perceived by the human eye. Visible light is usually defined as having wavelengths in the range of 400–700 nanometres (nm), corresponding to frequencies of 750–420 t ...

or heavy based on such quantities. This also produces

waste Waste (or wastes) are unwanted or unusable materials. Waste is any substance discarded after primary use, or is worthless, defective and of no use. A by-product, by contrast is a joint product of relatively minor economic value. A waste pr ...

materials and

waste heat Waste heat is heat that is produced by a machine, or other process that uses energy, as a byproduct of doing work. All such processes give off some waste heat as a fundamental result of the laws of thermodynamics. Waste heat has lower utilit ...

that may cause environmental problems or

pollution Pollution is the introduction of contaminants into the natural environment that cause adverse change. Pollution can take the form of any substance (solid, liquid, or gas) or energy (such as radioactivity, heat, sound, or light). Pollutants, th ...

(see

negative externalities In economics, an externality or external cost is an indirect cost or benefit to an uninvolved third party that arises as an effect of another party's (or parties') activity. Externalities can be considered as unpriced goods involved in either co ...

). Examples include textile production, car manufacturing, and handicraft. Manufacturing is an important activity in promoting

economic growth Economic growth can be defined as the increase or improvement in the inflation-adjusted market value of the goods and services produced by an economy in a financial year. Statisticians conventionally measure such growth as the percent rate o ...

and development. Nations that export manufactured products tend to generate higher marginal GDP growth, which supports higher incomes and therefore marginal tax revenue needed to fund such government expenditures as

health care Health care or healthcare is the improvement of health via the prevention, diagnosis, treatment, amelioration or cure of disease, illness, injury, and other physical and mental impairments in people. Health care is delivered by health pr ...

and

infrastructure Infrastructure is the set of facilities and systems that serve a country, city, or other area, and encompasses the services and facilities necessary for its economy, households and firms to function. Infrastructure is composed of public and priv ...

. Among

developed countries A developed country (or industrialized country, high-income country, more economically developed country (MEDC), advanced country) is a sovereign state that has a high quality of life, developed economy and advanced technological infrastruct ...

, it is an important source of well-paying jobs for the

middle class The middle class refers to a class of people in the middle of a social hierarchy, often defined by occupation, income, education, or social status. The term has historically been associated with modernity, capitalism and political debate. C ...

(e.g., engineering) to facilitate greater

social mobility Social mobility is the movement of individuals, families, households or other categories of people within or between social strata in a society. It is a change in social status relative to one's current social location within a given society ...

for successive generations on the economy. Currently, an estimated 20% of the

labor force The workforce or labour force is a concept referring to the pool of human beings either in employment or in unemployment. It is generally used to describe those working for a single company or industry, but can also apply to a geographic ...

in the United States is involved in the secondary industry. The secondary sector depends on the primary sector for the raw materials necessary for production. Countries that primarily produce agricultural and other raw materials (i.e., primary sector) tend to grow slowly and remain either under-developed or developing economies. The value added through the transformation of raw materials into finished goods reliably generates greater profitability, which underlies the faster growth of developed economies.

References

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