Chapter 11. Industry

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1 Chapter 11 Industry

2 Industry In this Chapter, Industry refers to the manufacturing of goods in a factory.

3 Key Issue #1 Where is industry distributed?

4 Manufacturing Value Added Fig. 11-1: The world s major manufacturing regions are found in North America, Europe, and East Asia. Other manufacturing centers are also found elsewhere.

5 The Industrial Revolution The Modern Concept of Industry began in the late 1700s in the United Kingdom. Before the Industrial Revolution, industry was dispersed geographically. Business was in the Cottage Industry stage. The Industrial Revolution was a collection in a variety of inventions, but the most important invention was that of the Steam Engine by James Watt

6 Industrial Revolution Industries All of these were created during the Industrial Revolution. Iron usefulness was known for centuries, but production was impractical until the Steam Engine. Coal The main source of energy to run iron mills. Transportation critical for diffusion. Canals and railroads were crucial in the spread of the industrial revolution. Textiles first industry to be replaced from the cottage to the factory. Chemicals industry created to bleach and dye cloth Food Processing needed to feed workers no longer living in farms.

7 Industrial Revolution Hearth Fig. 11-3: The Industrial Revolution originated in areas of northern England and southern Scotland. Factories often clustered near coalfields.

8 Industrial Areas in Europe Figure 11-4

9 Industrial Areas in North America Figure 11-5

10 United Kingdom First country to enter the Industrial Revolution. Dominated world production of steel and textiles. Became swaddled with old factories. Switched to high tech jobs to serve the European community.

11 Diffusion of Railways Fig. 11-4: The year by which the first railway opened shows the diffusion of railways and the Industrial Revolution from Britain.

12 Europe s other centers Rhine-Ruhr Valley Mid-Rhine Po Basin Northeaster Spain Moscow St. Petersburg Volga/Urals Kuznetsk/Donetsk/Silesia

13 Manufacturing Centers in Eastern Europe and Russia Fig. 11-5: Major manufacturing centers are clustered in southern Poland, European Russia, and the Ukraine. Other centers were developed east of the Urals.

14 North America New England Middle Atlantic Mohawk Valley Pittsburgh-Lake Erie Western Great Lakes Southern California Southeastern Ontario

15 Industrial Regions of North America Fig. 11-6: The major industrial regions of North America are clustered in the northeast U.S. and southeastern Canada, although there are other important centers.

16 East Asia - Japan Became a power in the 1950 s and 1960 s. Started with mass production at low costs. Expanded to electronics and automobiles. Similar to South Korea

17 East Asia - China Largest supply of low cost labor. Largest manufacturer of textiles, household appliances and steel. Manufacturing is clustered in three areas: Guangdong and Hong King Shanghai and Wuhan Tianjin and Beijing

18 Manufacturing Centers in East Asia Fig. 11-7: Many industries in China are clustered in three centers near the east coast. In Japan, production is clustered along the southeast coast.

19 Key Issue #2 Why are Situation Factors Important?

20 Proximity to Inputs The optimal plant location is close to inputs if the cost of transporting raw materials to the factory exceeds the costs of transporting goods to consumers. The optimal plant location is close to consumers if the cost of transporting goods to the consumers exceeds the costs of transporting inputs.

21 Why Are Situation Factors Important? Proximity to inputs Bulk-reducing industries Examples: Copper Steel Figure 11-8

22 Copper Industry in North America Fig. 11-8: Copper mining, concentration, smelting, and refining are examples of bulkreducing industries. Many are located near the copper mines in Arizona.

23 Copper Mine in Arizona The Lavender Pit Copper Mine in Bisbee, Arizona operated between 1951 and 1974.

24 Integrated Steel Mills Fig. 11-9: Integrated steel mills in the U.S. are clustered near the southern Great Lakes, which helped minimize transport costs of heavy raw materials.

25 U.S. Steel Mill (Gary, Indiana) The integrated steel mill of U.S. Steel in Gary, Indiana.

26 Nucor Steel Minimills Fig : Minimills produce steel from scrap metal, and they are distributed around the country near local markets. Nucor is the largest minimill operator.

Steel Production, 1980 Fig. 11-19a: The U.S., Soviet

27 Steel Production, 1980 Fig a: The U.S., Soviet Union, and Japan were the largest steel producers in 1980.

28 World Steel Production, 2005 Fig b: By 2005, steel production had increased in developing countries but declined in the more developed countries.

29 Distribution of Steel Production 1980 & 2005 Fig : Developed countries accounted for 80% of world production in 1980 but only 45% in LDCs increased from 20% to 55%. China is now the world s largest producer.

30 Shanghai Steel Factory The Baoshan Iron Steel Company in Shanghai, China

31 Why Are Situation Factors Important? Proximity to markets Bulk-gaining industries Examples: Fabricated metals Beverage production Single-market manufacturers Perishable products Figure 11-10

32 Location of Beer Breweries Fig : Beer brewing is a bulk-gaining industry that needs to be located near consumers. Breweries of the two largest brewers are located near major population centers.

33 Chevrolet Assembly Plants, 1955 Fig a: In 1955, GM assembled identical Chevrolets at ten final assembly plants located near major population centers.

34 Chevrolet Assembly Plants, 2007 Fig b: In 2007, GM was producing a wider variety of vehicles, and production of various models was spread through the interior of the country.

Motor Vehicle Parts Plants Fig. 11-13: U.S.

35 Motor Vehicle Parts Plants Fig : U.S.-owned parts plants are clustered near the main final assembly plants. Foreign-owned plants tend to be located further south, where labor unions are weaker.

36 Why Are Situation Factors Important? Ship, rail, truck, or air? The farther something is transported, the lower the cost per km/mile Cost decreases at different rates for each of the four modes Truck = most often for short-distance travel Train = used to ship longer distances (1 day +) Ship = slow, but very low cost per km/mile Air = most expensive, but very fast

37 Key Issue #3 Why are Site Factors Important?

38 Why Are Site Factors Important? Labor The most important site factor Labor-intensive industries Examples: textiles Textile and apparel spinning Textile and apparel weaving Textile and apparel assembly

39 Cotton Yarn Production Figure 11-16

40 Woven Cotton Fabric Production Figure 11-17

41 Production of Women s Blouses Figure 11-18

42 Why Are Site Factors Important? Land Rural sites Environmental factors Capital Figure 11-20

43 Key Issue #4 Why are Location Factors Changing?

44 Why Are Location Factors Changing? Renewed attraction of traditional industrial regions Proximity to skilled labor Fordist, or mass production Post-Fordist, or lean production Just-in-time delivery

45 Industrial Expansion Changing distribution within MDCs Intraregional shifts in manufacturing Interregional shifts in manufacturing New industrial regions Asia Latin America Central Europe

46 Changing Location Factors Attraction of new industrial regions Proximity to low-cost labor Outsourcing Renewed attraction of traditional industrial regions Proximity to skilled labor Just-in-time delivery

47 Sock & Hosiery Manufacturing Fig : Men s and women s socks and hosiery manufacturers usually locate near a low-cost labor force, such as found in the southeastern U.S.

48 Labor Cost per Hour MDCs and LDCs Fig : Hourly wages can be under $1 in many LDCs compared to well over $10 in many MDCs.

U.S. Clothing Production 1994-2005 Fig. 11-23: The percent of U.S. made

49 U.S. Clothing Production Fig : The percent of U.S. made clothing has declined sharply since the 1990s while imports have increased.

50 Computing Equipment Manufacture Fig : High skill workers are needed for manufacture of computing equipment. California, the Northeast, and Texas are the major sites.

51 Women s and Girls Apparel Fig 11-25: Products that require more skilled workers are still produced in or near New York City. Other items are produced in sites with lower cost labor.

52 Fedex Sorting and Loading Packages picked up by Fedex are transferred to planes, flown to sorting centers, transferred to other planes and flown to other cities, then loaded onto trucks for delivery the next day.

53 Why Are Location Factors Changing? Attraction of new industrial regions International shifts in industry East Asia South Asia Latin America Changing distributions Outsourcing

54 Container Ship in Seattle Harbor Most shipped goods are packed in uniformly sized containers that can quickly be transferred from ships to trucks or trains.

55 Child Labor in Textile Mills Child labor was common in the textile industry, which was transformed in the Industrial Revolution. Many spools of thread could be spun simultaneously if they were connected to a steam engine.

56 Cotton Yarn Production Fig a: Production of cotton yarn from fiber is clustered in major cotton growing countries, including the U.S., China, India, Pakistan, and Russia.

57 Distribution of Cotton Yarn Production Fig b: Three-quarters of cotton yarn is produced in less developed countries.

58 Chinese Textile Mill Fig c: Machine spinning spools of cotton at a textile mill in Zhengzhou, Henan Province, China.

59 Woven Cotton Fabric Production Fig a: Production of woven cotton fabric is labor intensive and is likely to be located in LDCs. China and India account for over 75% of world production.

60 Distribution of Woven Cotton Fabric Production Fig b: Over 80% of cotton fabric production is located in less developed countries.

61 Cotton Factory in India Fig c: Cotton looms in a factory in India.

62 Trouser Production Fig a: Sewing cotton fabric into men s and boys trousers is more likely to be located in developed countries, but much production now occurs in LDCs.

63 Distribution of Trouser Production Fig b: The majority of trouser production is in MDCs, near customers.

64 New York Garment District Fig c: Women sewing garments in the Garment District in New York.

65 U.S. Production Workers 1950 & 2005 Fig : States in the Northeast and Southern Great Lakes traditionally associated with manufacturing accounted for two-thirds of manufacturing in 1950 but only two-fifths of manufacturing in 2005.

66 European Union Structural Funds Fig : The European Union provides subsidies in regions with economic problems due to declining industries.

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