The essentials
Tertiary activities are related to the service sector. They do not produce goods directly but provide skills and expertise. Examples include trade, transport, communication and services such as those of doctors, teachers, lawyers, plumbers and bankers.
Trade is the buying and selling of items produced elsewhere. Trade centres may be rural marketing centres (serving nearby villages; quasi-urban, with basic services), periodic markets (held on fixed days, such as weekly or fortnightly, in rural areas with low demand) or urban marketing centres (offering specialised goods and services).
Key points
- Retail trade sells goods directly to consumers; wholesale trade buys in bulk from producers and supplies retailers through intermediaries.
- Retail can be store-based (shops, chain stores, departmental stores) or non-store (mail order, door-to-door selling, vending machines, online sales).
- Transport moves people, goods and materials; network density matters, and modes include road, rail, water and air.
- Communication involves transfer of words, messages and ideas; it was revolutionised by telephone, satellites and the internet.
- Services: low-skilled (domestic helpers), high-skilled (lawyers, doctors), government services and personal services.
- Tourism is the largest tertiary activity in terms of jobs and revenue; it depends on climate, landscape, history and art, culture and economy.
- Medical tourism: patients travelling abroad for treatment, for example to India for its relatively low-cost, high-quality care.
- Outsourcing: giving work to an outside agency to improve efficiency and reduce costs; Business Process Outsourcing (BPO) is a common form in India.
Exam tips
In case-based questions, check whether the activity produces goods (secondary) or a service (tertiary).
Common mistakes
A delivery driver or bank clerk is in the tertiary sector even if they work for a manufacturing company.