Theory

• De-industrialisation refers to the loss of jobs in the manufacturing sector, occurring in the UK in the second half of the twentieth century.
• Attributed to three main factors:

  • mechanisation: most firms can produce their goods more cheaply by using machines rather than people
  • competition from abroad, particularly the rapidly industrialising countries of the time such as Taiwan, South Korea, India and China
  • reduced demand for traditional products as new materials and technologies have been developed
• Urban areas bore the brunt of manufacturing job losses in the UK, but unemployment figures varied significantly between cities and depended upon the size of the city, the composition of the urban economy and the actions of local government (Northern cities such as Manchester and Liverpool experienced more extensive job losses than cities with more diverse economies)
• The decline of the manufacturing economy in the late twentieth century was accompanied by the rise of the service economy, including:

  • tertiary activities: financial services, retailing, leisure, transport, education and health (FLERTH)
  • quaternary activities: knowledge or ideas are the main output, such as advertising, computer programming and software design
• Population growth fuels the service sector but it has also grown because:

  • financial services are needed to support manufacturing industries, which are still important in many cities today
  • as societies become more technologically sophisticated, they need a larger range of specialised services to keep them running
  • as societies become wealthier, they demand more leisure and retail services
• While the growth in the service sector has gone some way to reducing the unemployment caused by de-industrialisation in urban areas, a number of problems still exist:

  • many of those made unemployed through de-industrialisation experienced long-term unemployment
  • many service jobs are part-time or temporary
  • number of service jobs has not made up for the loss of manufacturing jobs
  • lead to inner city decline - avoided by service industries