Tertiary sector: what it is, characteristics and importance for the economy

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The tertiary sector, also called the service sector, is the branch of economy that encompasses the service and trade activities.

The area is called the third sector because it is part of a broad spectrum composed of three sectors. The primary sector corresponds to agricultural and extractive activities and the secondary sector is formed by industrial activities.

Characteristics of the tertiary sector

The main characteristics of this sector of activities are related to its area of ​​expertise. The main ones are:

  • It is the sector responsible for providing the market with products and services,
  • Operates in the trade and sales area,
  • It is heterogeneous, as it includes activities of different types of service provision and product sales,
  • It employs the majority of Brazilian workers (approximately 60%).

What is service delivery?

The area of ​​service provision is wide and covers numerous activities, that is, any type of business involving the offering and purchasing a service performed by a company or service person fits this classification.

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The activities developed by self-employed professionals fit into the provision of services, such as dentists, lawyers, business administrators, mechanics, designers, restaurant and bar attendants, shop vendors, telemarketing, computer programmers, among others.

Also part of the provision of services are activities such as banking services, companies that provide consulting services various, specialized technical assistance and entities that develop educational, health or safety.

Service provision activities are called intangible or immaterial goods. These activities receive this name because they are not tangible, being characterized by the provision of services and the provision of labor.

What is commerce?

The trade sector, as well as the provision of services, is also very comprehensive, as it includes hundreds of activities linked to the commercialization (buying and selling) of goods. Goods that are traded by commerce, produced by the primary and secondary sectors, are classified as material goods.

Included in the trade sector are purchase and sale activities, both wholesale and retail.

In retail trade, the sale of products is aimed at the final consumer of the product, while in wholesale trade, the sale is aimed at other companies whose main activity is the resale of goods.

It is also important to know that the trade sector includes all types of companies that involve the sale of goods, from small family businesses to multinationals.

Read more about Wholesale and retail.

Importance of the tertiary sector for the economy

The tertiary sector is fundamental for the heating and growth of the country's economy, being directly related to the Gross Domestic Product (GDP) index, the creation of jobs and income.

According to information from the Ministry of Industry, Foreign Trade and Services, the activities carried out by the tertiary sector in recent years had a direct influence on Brazil's GDP. In the last decade, the trade and services sector was responsible for the increase of 7.5% of the national GDP.

The sector's economic development is also influenced by its relationship with the primary and secondary sectors. Companies in these two sectors are consumers of its services and products from the tertiary sector, especially the raw materials, supplied by it.

Tertiary sector hypertrophy

This expression is used to designate the unplanned growth of the tertiary sector, a fact that occurs a lot in Brazil.

The sector's hypertrophy is responsible for the emergence of consequences that are difficult to control and supervise, such as the increase in informal activities, without employment contracts, guarantee of labor rights and without regulation proper.

Another possible consequence of the hypertrophy of the tertiary sector is a decrease in productivity or a decrease in the quality of products and goods that are offered by the sector.

Difference between the tertiary sector and the third sector

Despite the similar names, the expressions tertiary sector and third sector should not be confused, as they do not have the same meaning.

The tertiary sector comprises the sector of the economy that involves companies or people who carry out activities in the provision of services, or commerce. Thus, tertiary sector is a name referring to an economic classification.

The third sector refers to civil society organizations or groups that carry out activities non-profit provision of services that were originally supposed to be offered by governments.

Organizations that promote voluntary work activities and all non-governmental organizations, non-profit entities, foundations and other entities philanthropic.

Control of activities performed by the tertiary sector

The activities carried out by companies and service providers belonging to the sector are regulated, at the federal level, by the Ministry of Industry, Foreign Trade and Services. The Ministry's body that carries out this work is the Secretariat of Commerce and Services.

Functions of the Secretariat of Commerce and Services

Among other functions, the Secretariat is responsible for creating and implementing policies to encourage, modernize, and simplify the activities of the trade and service provision sectors. The purpose of these standards is to provide guidance and procedures that allow activities to be carried out in the best possible way.

The body, according to the Decree that created it (federal decree No. 5.532/05), is also responsible for develop methods of analysis and monitoring of the main trends in the sector, both in Brazil and in the outside.

What are the three sectors of the economy?

In addition to the tertiary sector, which is focused on providing products and services to consumers, there are also two other sectors: primary and secondary.

O primary sector carries out activities that are linked to the extraction and exploitation of natural resources. Another function of the primary sector is to provide raw material for the industries that manufacture the products that will be sent to trade. The primary sector carries out activities in agriculture, mining, livestock, fishing, among others.

already the secondary sector is responsible for the task of production and industrialization of products. It is the branch of the economy that transforms raw materials produced by the primary sector into goods that will be sold to consumers. For example: food, automobile, textile, electronics, etc. industry.

See more about the meanings of Third sector, NGO and Philanthropy.

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