Tritiya kshetra ko seva kshetra kyon kahate hain

 

Why the Tertiary sector is called the service sector

In broad categorization, the structure of any economy can be divided into three main sectors: the primary sector, the secondary sector, and the tertiary sector. Each sector plays an important role in the development and functioning of an economy. The tertiary sector occupies a unique position, as opposed to the primary sector involved with the extraction of natural resources and the secondary sector involved with manufacturing and industrial activities. It is commonly referred to as the service sector. But why does the tertiary sector go by the name of service sector, and what might its role be in modern economies? This article explores the characteristics, importance, and examples of the tertiary sector that provide comprehensive insight into its importance.

1. Understanding Economic Sectors

Economies are traditionally divided into three main sectors for ease of studying economic activities:

1. Primary Sector: This involves activities related to the extraction and production of natural resources, such as agriculture, fishing, mining, forestry, and the like. The primary sector is the very base of any economy, as it provides raw materials to other sectors.

2. Secondary Sector: This is the sector that deals with processing and manufacturing raw materials into finished goods. These would include industries, manufacturing plants, construction activities, and production facilities. This sector increases value added to primary products and would significantly contribute towards accelerating economic growth.

3. Tertiary Sector: The tertiary sector is quite different from the first two sectors in that it does not produce tangible goods. Instead, it offers services to people, businesses, and governments. These services facilitate the smooth running of the first two sectors and also meet the needs of the general population.

Therefore, the tertiary sector is different in that it deals mainly with intangible products, service rather than physical goods.

2. Definition of the tertiary sector

The tertiary sector of the economy is the service-based portion. Services are economic activities where no physical goods are transferred as a result of the activity but expertise, convenience, or amusement may be provided. Economic theory defines services as actions, efforts, or performances by one party for another involving compensation but no transfer of ownership. Common examples include education, healthcare, transportation, banking, hospitality, retail, information technology, and communication services.

Because this industry deals with the provision of services rather than goods, it is also known as the service industry. The tertiary sector has grown very rapidly in modern economic systems, reflecting the greater demand for services compared to goods in both developed and developing nations.

3. Features of the Tertiary Sector

A few characteristic features distinguish the tertiary sector from primary and secondary sectors:

1. Intangibility: The services rendered by the tertiary sector cannot either be seen or touched. For instance, education or legal advice cannot be held physically; the value in them lies in the expertise and outcome.

2. Involvement of Human Resources: The tertiary sector largely depends on skilled human resources. The quality of service depends on the knowledge, skill, and efficiency of the workers.

3. Simultaneity of Production and Consumption: Unlike goods, which can be produced and stored for sale at a later stage, the production and consumption of services often take place simultaneously. For example, a haircut or a medical consultation is both consumed and produced at the same time.

4. Customer Interaction: Most services require an interaction between the seller of the service and the customer themselves. This is very crucial in ensuring satisfaction and quality of the service.

5. Intensive in Knowledge and Skills: Most services require specialized knowledge in the areas of finance, health, law, or technology, so that the sector becomes highly dependent on human capital.

4. Why the Tertiary Sector is called the Service Sector

The correct definition of the tertiary sector is indeed service sector because:

1. Supply of Services: The primary role of this industry is the provision of services that enable society and other economic sectors to perform. Unlike agriculture or manufacturing, the output of this tertiary industry constitutes intangible services.

2. Support to Other Sectors: Transportation, banking, and marketing services support both the primary and secondary sectors. In the absence of these services, raw materials would not reach the industries or finished goods reach the consumers in time.

3. Direct Interaction with Consumers: Most tertiary activities are directly related to the provision for the consumers. Retail, hospitality, healthcare sectors exist in order to serve people; therefore, the term “service” is appropriate.

4. Contribution to Economic Development: The tertiary sector increases productivity and efficiency through appropriate services related to education, research, communication, etc. Its main objective is serving rather than producing goods.

5. Intangibility of Output: Since the sector deals mainly with intangible outputs such as advice, convenience, or expertise, it is essentially a service-based sector.

5. Examples of the Tertiary Sector

This tertiary sector is vast and diverse; the gamut of the activities it runs is large. For instance:

 Healthcare Services: Health facilities, clinics, and even telemedicine services provide health services to improve well-being.

Education includes services from schools, colleges, coaching institutes, and online learning platforms.

• Financial Services: Banks and insurance companies, along with other investment firms, provide financial support and financial planning.

Transport and Logistics: Airlines, railways, shipping, and delivery services provide the means of easy movement for products and humans.

Information Technology and Communication: IT services, software companies, internet providers, and telecommunication services improve networking and speed.

Hospitality and Tourism - Hotels, restaurants, travel agencies, and tourism boards provide services in this category for leisure and recreation.

 Retail and Wholesale Trade: Supermarkets, online marketplaces, and retail stores connect customers to their products.

Entertainment and Media: These include television, cinema, digital media, and sports management that offer recreational services.

Professional Services: These include legal firms, consultancy agencies, and engineering services that avail professional advice and solutions.

These examples point out that the tertiary sector satisfies mainly human needs and other economic sectors by providing services.

6. Importance of the tertiary sector

The tertiary sector plays a very significant role in the economic development of a country. Its importance can be understood with the help of the following points:

1. Promotes Economic Growth: The tertiary sector enhances the overall productivity and efficiency of a nation by providing necessary services to primary and secondary sectors.

2. Employment Generation: It is a labour-intensive sector, thereby creating huge employment opportunities, especially for skilled workers. With development, the level of employment in this sector usually outgrows the primary and secondary sectors.

3. Promotes Trade and Commerce: Banking, insurance, transportation, and retail services facilitate domestic and international trade with ease.

4. Quality of Life Improved: Healthcare, educational services, and recreational facilities contribute to better living standards.

5. Innovation and Technology: IT services, research institutions, and consultancy firms contribute to innovation thus making processes in other sectors more efficient.

6. Contributes to GDP: In most developed nations, the tertiary sector contributes the largest share of Gross Domestic Product, reflecting the shift from goods-based economies to service-based economies.

7. Growth of the Tertiary Sector

It is a global phenomenon wherein the tertiary sector has grown due to many factors:

Urbanization: People moving to urban areas raise the demand in service sectors such as transportation, housing, health care, and education.

 Rising Income Levels: Higher disposable income results in higher demand for services like travel and entertainment, and personal care.

Technological Advances: Digital technologies and the internet have enabled the expansion of services, ranging from online banking and e-healthcare to telemedicine.

Globalisation: There has been a rapid growth in international trade and business services, and this has created a global demand for service providers. Shifting Consumer Preferences: Today, consumers increasingly seek convenience, quality, and experiences over just goods, thus giving a fillip to the service sector. 8. Conclusion The tertiary sector, or the service sector, is an indispensable part of modern economies. In contradistinction to primary and secondary, it caters to the provision of services rather than the production of physical goods. The main functions underlying in this sector are to provide supportive activities to other sectors, consumer needs, create jobs, and contribute to the country's economy. By nature, it is intangible in output, human resource-based, and is direct consumer-interaction-oriented; it has thus been correctly called the service sector. In other words, the tertiary sector will continue to grow in importance as economies further develop and change, based on shifting notions of work, consumption, and global economic priorities. Knowing why the tertiary sector is also known as the service sector helps us better fathom the role of services in modern life and in the pursuit of economic well-being.