You locational factors of the industry they are the set of socio-spatial and structural elements that interfere or directly relate to the distribution of industries in a given territory or between different territories. It is, therefore, the series of elements that the different locations need to have to receive a greater number of industries in their territorial unit.
In general, we can consider that there is a dispute between different places to attract companies and investments, so that the places that offer the best infrastructure and the greatest economic advantages come out ahead in this regard.
Understanding industrial location factors means understanding historical-geographic dynamics regarding the distribution and migration of companies and factories between the different units space. If a region concentrates more industries than the other or if, over time, a considerable number of companies left some territories towards others, it is understood that locational factors were determining or important for the occurrence of these Law Suit.
Didactically, the most diverse types of locational factors of the industries are listed, as we will see in follow, although they do not always explain the different socio-spatial behaviors of companies capitalists. In general, elements that go beyond basic instances are considered, such as the economic and political stability of territories, the permissiveness of laws and other issues.
The main factors that determine industrial location are:
1. Ample and professionally qualified workforce – in many cases, companies seek those places where there is a very wide and cheap pool of labor and that meets their interests. Depending on the type of industry, there is a preference for societies that have a population with a higher level of technical training to operate the necessary equipment. Therefore, many countries invest in the dissemination of specific technical courses to attract industries and generate jobs.
The biggest examples of markets that have been attracting companies with a broad, cheap labor pool and with some professional qualifications are emerging countries. Highlights go to China and India.
2. Availability of raw materials – places that have easy access to raw materials are also considered advantageous for installation of companies, although this factor was more prevalent in the past, when transport costs were larger. Even so, many factories move part of their production to regions where the production of certain commodities – mainly mineral resources – is more pronounced.
3. Tax breaks – are the taxes that are no longer charged by the government to attract a particular company, which aims to reduce costs and maximize profits. Therefore, many places with similar location characteristics compete for companies by granting benefits, which is at the heart of the issue of fiscal war, which has become a structural problem for Brazil and other countries.
The issue of tax incentives is not always permeated by the competition of places in terms of tax exemptions. In some cases, these incentives translate into the existence of a less heavy tax burden or, simply, more summarized and facilitated, avoiding bureaucratic problems for companies, entrepreneurs and investors in general.
4. Existence of logistic infrastructure (transport) – the faster and cheaper the companies' production flow systems, the greater the profits. Therefore, many industries take into account those places that have articulated and efficient modes of transport and logistics. Thus, many governments in their most diverse spheres invest in these structures to serve the greatest number possible of companies, investing in viaducts, wide roads, railways, waterways and in the improvement of these and others modals.
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A strategy widely adopted in Brazil and in the world is the construction of the so-called industrial districts, which are areas – public or private – specially designed for industries. The location of these areas precisely follows the logistical strategy, that is, they are positioned separately from the more swollen areas of large cities and have exits to highways, railways and airports.
5. Favorable energy infrastructure – if a country or region has a large energy production, with low risk of crises in this sector, the number of investments tends to increase. Many types of industries they consume a high load of energy, like the factories that produce aluminum. Therefore, they need government guarantees that production will not be reduced or interrupted for energy reasons, which permeates not only a high electrical production of places, but also diversified, that is, based on the different energy sources (hydraulic, wind, solar, thermal, etc.) and therefore less risky.
6. Soft labor laws and limited unions – in the socio-spatial and historical process of the constitution of societies, the class struggle plays one of the main roles, which is no different in this case. Many employers and investors do not usually invest in countries or regions that have a high level of union organization or very strong labor laws as this raises labor costs and lowers profits and returns on investments performed.
Throughout the 20th century and the beginning of the 21st century, what was seen in this sense was precisely a weakening of union organizations or their equipping, in order to avoid setbacks by of investors. In China, for example, labor rights are greatly reduced and labor costs are much lower than in other countries, the which attracts an unparalleled number of companies, although the proposal of the so-called “communist” Chinese government is precisely to strengthen the class hardworking.
7. Large and active consumer market – when a location has a consumer market that, in addition to being numerous, is very active and growing, there is a increase in the number of companies and factories that seek to establish themselves in this region to serve this market and generate profits. Although the globalization process allows the service of markets that are in the most distant areas of the globe, Those companies that are located closer and that are able to offer quality products at prices gain advantages. minors.
8. Presence of related companies and corresponding service networks – in some types of industries, there is a concern about a location presenting the necessary bases for the maintenance of its equipment, as it would be useless to settle in a region that does not have companies and professionals capable of guaranteeing the maintenance of the mechanisms factories. In this sense, companies take into account the presence of other industries of the same segment, as this indicates that there will be, at the site, other companies and professionals specialized in servicing your needs.
9. Existence of science and technology institutions – places where many universities and scientific and technological centers are found are considered attractive for companies that need of these services, as they train specialized professionals and ensure rapid improvement of production conditions and strategies industrial.
Given all these factors, we can see that there is great competition between the different territories that make up the geographic space to attract as many companies and industries. After all, their presence is considered a way to generate jobs, increase revenue, boost consumption and boost local and regional economic production.
By Me. Rodolfo Alves Pena
