Sectors of Economy: Primary, Secondary, Tertiary, Quaternary, Quinary

Sectors of Economy is an important topic that comes under the economics part of Paper IV of Civil Services Main Examination and is quite important for the Civil Services Preliminary Examination as well. In this article, we are going to learn about the sectors of Economy in view of both Preliminary and Mains Examinations. 


What is Economy? 

Economy can be defined as careful management of wealth and resources of a country, i.e., the activities involving production distribution, trade and consumption of goods and services, determining the resource allocation. 

Sectors of Economy 

Economy can be classified into different sectors on the basis of the type of economic activity going on. Economic activities are nothing but human activities that generate income. Starting from raw materials, they are classified on how far they go from the natural environment. 

Economic activities are classified in to three categories namely: 

  • Primary 
  • Secondary 
  • Tertiary sectors 

Tertiary activities are further classified into two categories namely: 

  • Quaternary 
  • Quinary sectors. 

Primary Sector 

This sector of the economy deals with the primary economic activities which depend on the utilization of natural resources from the earth like water, lands, trees, minerals and building materials. It also deals with the activities like agriculture, hunting, fishing, grazing, forestry, mining etc. 

The jobs involving primary activities are called ‘red-collar’ jobs because the work is of outdoor nature. The percentage of workers that are involved in the primary sector is reducing by the day in developed countries and developing countries. 

Secondary Sector 

This sector of the economy deals with activities that involve production of finished goods, i.e., transformation of raw materials extracted in the primary sector into valuable products by adding value to the natural resources. Simply put, activities in the Secondary sector deal with manufacturing, processing and construction activities. 

Secondary activities include smelting, production of automobile, production of textile, chemical industries, engineering industries, manufacturing related to aerospace, bottles, breweries, shipbuilding, manufacture of infrastructure in construction activities, etc.  

The jobs involving the secondary activities are called ‘blue-collar’ jobs and the people doing those jobs are called blue-collar workers.  

Tertiary Sector 

Also referred to as the service industry, this sector of economy deals with activities involving both production as well as exchange. Production is providing consumable services. Exchange involves services that help overcome the distance, like transport, trade, communication, etc. 

In this sector of economy, the activities involve selling of the products manufactured in the Secondary sector. Commercial services to the general public as well as businesses in all the five sectors of economy are provided by the tertiary sector. Activities in the tertiary sector are wholesale and retail sales, restaurants, tourism, banking, insurance, health care, law and order, media, clerical services, etc. 

The jobs involving the Tertiary services are called ‘white-collar’ jobs. The percentage of workers that are involved in this sector are increasing in proportion in both developed and developing countries. 

We’ve discussed the three main sectors of economy. Now, tertiary sector can be further classified into two sectors. Quaternary and Quinary sectors. 

Quaternary Sector 

This sub-sector of Tertiary sector, famously called the ‘Knowledge economy’, deals with specialized or intellectual activities, related to innovation in technology. There has been a proportionate growth in demand for the services provided by this sector due to the increase in demand for services like mutual-funds management, tax consultants, software developers and statistical analysts who provide information-based services. 

Activities in this sector can be related to the government, schools, universities, libraries, hospitals, culture, information technology, research, etc. These are the intellectual activities that cause advancement in technology and growth in the economy of a nation. 

Quinary Sector 

The Quaternary sector could be further narrowed down into Quinary sector. The activities under this sector deal with the highest level of decision making in a society or in an economy, focusing on creating new ideas, and re-arrangement and interpretation of the existing ideas. 

This may also include police and fire departments, which are public service organizations or non-profit organizations still contributing to the economy by providing free services. Some domestic services like housekeeping, child care, though aren’t of monetary value, are also considered quinary activities. 

The personnel under Quinary sector are called ‘gold collar’ professionals, as they represent highly skilled senior business executives, government officials, scientists, legal and financial consultants. Though they are less in number, their importance in the economic advancement far outweighs it. 

That is all about different sectors of economy. This is how it works for any nation. For more information on other topics for the UPSC Civil Services Exam, or tips to follow, please subscribe to our blog posts. 


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