Ch.

11 Outline
I.

Where Is Industry Distributed?

Industrial Regions

1.

Concentrated in three main areas: Europe, North America, and East Asia.
Other areas are Brazil and India

Europes Industrial Areas

United Kingdom:
Dominated world production of steel and textiles in the 19th century.
First country to enter the Industrial Revolution
No longer a world leader.
Attracts high-tech industries
Japan has built factories here

Rhine-Ruhr Valley:
Western Europes most important and centrally located industrial area.
Dispersed area
Iron and steel are concentrated here because of large coalfields.
Stimulated other heavy metal industries like railroad, machinery, armaments
Rotterdam is the worlds largest port.

Mid-Rhine:
Western Europes second most important area.
The German portion lacks raw materials
Three largest cities: Frankfort (financial and commercial center), Stuttgart (high value goods), and Mannheim
(chemical industry)
The French portion contains iron-ore fields and produces steel
Two largest cities: Alsace and Lorraine

Po Basin:
Southern Europes oldest and most important area.
Italy does its manufacturing here
2 key assets: inexpensive hydroelectric power and the Alps
Large labor supply

Northeastern Spain:
Western Europes fastest growing industrial area in the late 20th century.
The leading industrial area is Catalonia in Barcelona.
Textile industry and the Motor-vehicle industry

Moscow:
Russias oldest industrial area.
Specializes in fabrics and products that require skilled labor.

St. Petersburg:
Eastern Europes second largest city.
Specializes in shipbuilding and other industries that support Russias navy and ports.

Seth Adler

Volga:
Russias largest petroleum fields.
Motor-vehicle Togliatti
Oil Kuybyshev
Chemicals Saratov
Metal Volgograd
Leather and fur Kazan

Urals:
Many types of minerals.
Encouraged Communists to look for iron and steel

Kuznetsk:
Russias most important area east of the Ural Mountains.
There is coal and iron.

Donetsk:
Located in Eastern Ukraine.
Rich in iron, coal, and natural gas.

Silesia:
Includes Poland and the Czech Republic.
Important steel producing center.

North Americas Industrial Areas

New England:
Oldest industrial area in the northeast.
Made cotton textiles.
Middle Atlantic:
Largest US market.
Induces industries that need a lot of consumers and depend on foreign trade

Mohawk Valley:
Industrial belt in New York.
Used energy from Niagara Falls
Attracted steel, food, aluminum, and paper industries.

Pittsburgh-Lake Erie:
Leading steel-producing area.
Located near Appalachian coal and iron ore

Western Great Lakes:

Centered in Chicago.
Center of steel production and motor vehicles.

Southern California:
Leading area outside the Northeast.
When the US entered WWII, the aircraft industry rose.
More recently, it produces textiles and food-processing center.

2.

Predominantly an agricultural society before independence.

First textile mill opened in Pawtucket, Rhode Island in 1791

Southeastern Ontario:
Canadas most important Industrial area.
East Asias Industrial Areas

Seth Adler

II.

Japan:
Became an industrial power in the 1950s.
Produced goods that could be sold cheaply to other countries
Workers received lower wages
Leading manufacturer in cars, ships, cameras, stereos, and televisions
When Japan heard that South Korea and Taiwan were making cheaper industries, they decided to train their
workers.
Made in Japan is now good on electronics
Central region

China:
Largest supply of low-cost labor.
Makes household items
Policy changed in the 1990s opened their market for transnational corporations.
Foreign owned firms wanting low cost labor could open factories here
Clustered in three areas: Hong Kong, the Yangtze River valley, and the Gulf of Bo Hai.

Why Are Situation Factors Important?

a. Situation Factors Location factors related to the transportation to and from a factory.
b. Proximity to Inputs
a. The farther something is transported, the higher the cost. Companies try to minimize the distance from a factory to
both buyers and sellers.
The optimum plant location is as close as possible to inputs if the cost of transporting raw materials
exceeds the cost of shipping to customers.
The optimum plant location is as close to the customers if the weight of the product is heavier than the
raw materials.
b. Bulk-Reducing Industry An industry in which the input weigh more than the final product.
(1) Need to locate close to the source of inputs
1.

Copper: A Bulk Reducing Industry

(1) Mining.
The first step is mining the copper ore.
Bulk-reducing because bulky ore is mostly waste called gangue.
(2) Concentration.
Concentration mills crush and grind the ore.
25% copper.
Near the mines.
(3) Smelting.
a. Smelting removes more impurities.
(1) Copper matte 60%
(2) Blister copper 97%
(3) Anode copper 99%
(4) Refining.
a. Produces copper cathodes (99.99% pure copper).
b. Does not need to be close to mines.

2.

Steel: Changing Importance of Inputs

a. Steel is an alloy of iron that is made by removing impurities in iron, such as silicon, phosphorus, sulfur, and
oxygen, then adding manganese and chromium.
(1) The two main inputs are iron ore and coal
b. Steel was a luxury until Henry Bessemer patented an efficient process for casting steel in 1855.
c. Steel is now important to be close to the market.
(1) Mini-mills
Main input is scrap metal

Mid-nineteenth century:
a. The US steel industry concentrated around Pittsburgh because of the iron and coalmines. There are no longer
any steel mills, but there are research centers.
Late nineteenth century:

Seth Adler

a. Steel mills were built around Lake Erie because of the discovery of rich iron ore in the Mesabi Range.
b. Coal was brought from Appalachia by train.
Early twentieth century:
a. New steel mills were built near the southern end of Lake Michigan because more iron than coal was needed. To
minimize transportation costs, new mills were being built closer to the Mesabi Range.
Mid-twentieth century:
a. Factories were located on the East and West Coast. They started importing iron ore from other countries, like
Canada and Venezuela.
Late twentieth century:
a. Most steel mills are closed. The few left are in Lake Michigan along the East Coast.

A. Proximity to Markets
1.

Bulk-Gaining Industries
a. Bulk-Gaining Industry Industry that makes something gain volume or weight during production.
- Fabricated Metals
a. A fabricated-metal factory brings together metals such as steel and previously manufactured parts as
inputs and makes a more complex item.
b. Fabricating shapes pieces of metal by bending, forging, stamping, and forming.
(1) Welding, bonding, and bolts and rivets join separate parts.
c. Steel fabricators are located near markets.
d. The largest market is the motor vehicles.
o At a global scale: vehicles sold in the US are made in the US.
o At a national scale: Most assembly plants are located in the interior of the US, between Michigan and
Alabama.
i.
Known as auto alley
- Beverage Production
a. Beverage bottling is an industry that adds bulk.
(1) Empty cans and bottles are brought in, filled with drink, then shipped to the consumer
b. Because water is located where consumers live, they build factories closer to where people live so they
dont have to ship water.

2.

Single-Market Manufacturers
a. Single-market manufacturers are manufacturers with only one or two customers.
(1) They are located close to them
b. An example is a producer for car parts.
(1) They will sell directly to Ford or Toyota
c. They need to be as close as possible to the customers.
(1) Seats and engines are too bulky to waste inventory space

3.

Perishable Products
a. Bakers and milk bottlers must be located as close as possible to their customers.
b. Processors of food into frozen or cans are located farther.
c. The daily newspaper is also perishable.
(1) Difficulty with timely delivery is one of the factors in the decline of newspapers.

B. Ship, Rail, Truck, or Air?

a. The farther something is transported, the lower is cost per kilometer
(1) This is because companies have to pay workers to load and unload weather the package going 10km or 1000km

Trucks.
a. Most often used for short deliveries.
(1) They can be loaded and unloaded easily
b. Better if the driver can reach the destination within a day, before having to stop for a rest.

Trains.
a. Often used to ship to destinations that are over a day away.
(1) East and West Coast
b. They take longer to load and unload, but they do not have to stop for rests.

Ships.
a. Good for very long distances because the cost per kilometer is very low.
b. Slower, but it is used for transporting stuff that cant be done by truck or train.

Seth Adler

Air.
a. Most expensive.
b. Used for speedy deliver of small, high-value items.

b.

Modes are often mixed.

(1) Airfreight companies pick up packages in the afternoon and transport them to the nearest airport. They are
packed at night and flown to an airport hub. They are then flown on another plane to a closer airport and
unloaded onto a truck.
Containers may be packed into a rail car, transferred to a container ship and shipped over the ocean.
(1) Some large ships are made for rectangular containers
Break-Of-Bulk Point Location where transfer among transportation modes is possible.
(1) Important points are airports and seaports.

c.
d.
III.

Why Are Site Factors Important?

a. Site Factors Location factors relating to the costs of factors of production inside the plant.
(1) Land, labor, and capital
A. Labor
a.
b.

The most important factor at a global scale is labor.

Worldwide, about one-half billion people are engaged in industry.
(1) China
(2) India 1/5
(3) Other MDCs 1/5

1.

Labor-Intensive Industries
a. Labor-Intensive Industry An industry in which the wages paid to the workers make up a high percentage of
the overall expenses.
(1) The US has an average of 11% of the overall manufacturing costs in the US. A labor-intensive industry
would have much higher.
b. The average wage of a manufacturing worker in North America is over $20 an hour.
(1) In LDCs, they are less than $5
c. A labor-intensive industry is not the same as a high-wage industry.
(1) Labor-intensive is measured as a percentage
i.
Motor-vehicle workers are paid much higher than textile workers are, but they do not use up a
large amount of the expenses. More money is used buying the parts than for paying the
workers. In the textile industry, more money is used to pay the workers than buying the
supplies.

2.

Textiles: Labor-Intensive
a. Textiles Woven fabrics.
b. 3 steps:
Spinning of fibers to make yarn from natural materials
Weaving or knitting yarn to make fabrics
Cutting and assembling fabrics to make the clothing or products
-

Textile And Apparel Spinning

a. Fibers can be spun from natural or synthetic elements.
(1) The principle fiber is cotton
b. Before the Industrial Revolution, the spinning of cotton was for unmarried women, called a spinster.
(1) Children performed carding, which is the untangling of fibers and putting them onto rolls, called
cards
c. Because it is still labor intensive, it is done in low-wage countries.
(1) China produces 2/3 of the worlds cotton thread
d. The first commercially successful regenerating synthetic fiber was rayon, made by processing the
cellulose in wood pulp.
e. The first true synthetic fiber was nylon, produced from petroleum in 1937.
f. Polyester is the leading synthetic.

Textile And Apparel Weaving

a. For thousands of years, thread was woven with a loom.
(1) One set of threads, warp, is strung lengthwise and the other, weft, is inserted over and under and
over and under

Seth Adler
b.

(2) This was for men because it was physically hard

For mechanized weaving, labor is a high percentage of the cost.
(1) 93% is done in LDCs
i.
China 60%
ii.
India 30%

Textile And Apparel Assembly

a. Sewing is the oldest activity.
b. Barthelme Thimonnier invented the first sewing machine in 1830.
(1) He installed 80 machines to sew uniforms for the French army. Fearing that he would put them out
of business, Parisian tailors stormed the factory.
c. Isaac Singer invented the first successful sewing machine in the US during the 1850s.
(1) He was convicted of infringing a patent filed by Elias Howe in 1846
d. Four main types of textiles:
(1) Garments
(2) Carpets
(3) Home products (bed linen, curtains)
(4) Industrial items (headliners inside cars)
e. MDCs play a larger role in assembly.

B. Land
1.

Rural Sites
a. A city offers an attractive situation.
(1) Close to a local market and convenient means of shipping to a national market by train
b. A city offers an attractive site.
(1) Close to a large supply of labor as well as people to sell it to
(2) There is not a lot of land, though
i.
Early factories were multistory.
(1) Raw materials were hoisted up to become smaller, then they were sent down through a
chute
(2) Water was stored in tanks on the roof
c. New factories are more efficient as one story.
(1) Raw materials are sent in at one end and move through the factory on conveyors or forklifts.
d. In the past, the railway would come by the factory. Now they dont rely on trains.

2.

Environmental Factors
a. Not all locations are the same.
(1) Factories are built depending on the climate, topography, cultural reasons, sports franchises, and cost of
living
b. Factories used to be built near forests and rivers because water and wood were the most important sources
for energy.
(1) Now, they are concentrated near coalfields
c. A factory also chooses its location based on the cost of electricity.
d. The aluminum industry requires a lot of electricity to separate bauxite ore.
(1) They will locate near dams to use hydroelectric power
(2) The oldest aluminum factory in the US is at Massena, New York est. 1902 by the Pittsburgh Power Co.
(now Alcoa, Inc.) near a dam on the St. Laurence River

C. Capital
a. The US motor-vehicle industry is located in Michigan because banks up there were more willing to give them
money.
(1) The banks in Californias Silicon Valley also provide money for new software companies.
b. Because LDCs do not have money from banks, they are forced to borrow money from MDCs.
(1) Some MDCs will not lend money to a country that has an unstable economy, high debt levels, or bad
economic policies.
IV.

Why Are Location Factors Changing?

a. Changing site factors have been important in stimulating industrial growth in new regions.
A. Attraction of New Industrial Regions
a. Labor is the most dramatic change.
(1) Companies want cheaper labor in LDCs

Seth Adler
1.

Changing Industrial Distribution Within MDCs

2.

Interregional Shift in the United States

a. Industrialization during the late 19th century largely bypassed the South because they were recovering from the Civil
War.
- Right-To-Work Laws
a. Right-To-Work Laws A law that prevents a union and company from forcing the worker to join the
union.
(1) By enacting these laws, Southern states made it more difficult for companies to organize factory
workers, collect dues, and bargain with employers from a power of strength
(2) Also attracted companies that did not want unions
i.
Did not want workers striking for safer conditions and higher wages
b. The Gulf Coast has become an important industrial area because of its access to oil and natural gas.
- Textile Production
a. Heavily concentrated in the Northeast and diffused to the South and West.
b. New Yorks Garment District at 7th Avenue and 33rd Street once housed a large percentage of the nations
textile manufacturers.
(1) Large supply of European immigrants
c. During the mid-nineteenth century, most textile production moved to the Southeast.
(1) North Carolina, South Carolina, Georgia, Alabama
i.
99% of US sock production.
- Interregional Shifts In Europe
a. European government encourages the industrial relocation.
Convergence Regions: Eastern and Southern Europe, where income lags behind Europes average.
Competitive and Employment Regions: Western Europes traditional core industrial areas, which
are experiencing, job losses.
b. The country in Western Europe with the most improvement is Spain.
(1) Administered to the EU in 1986
(2) Before that, it was geographically and politically isolated
(3) Second leading car manufacturer behind Germany
c. Poland, Hungary, and Czech Republic consider themselves Central Europe.
(1) It is close to labor and market proximity.

3.

International Shifts in Industry

a. In the 1970s, Europe had of the worlds industry and North America had 1/3. Now they only have each.

East Asia.
a. Rapid industrial growth in China means an increasing share of the worlds industry.
b. In addition to China and Japan, there is also South Korea.
(1) Worlds leading producer of large container ships, helpful for international trade.

South Asia.
a. Led by India, which is one of the fastest growing economies.
(1) Textiles are the dominant industry, but they also produce motor-vehicles
(2) GDP is supposed to equal the US by 2050

Latin America.
a. Maquiladora plants are located in Northern Mexico.
b. Brazil is the leading industrial center in Latin America.
(1) Also clustered in Sao Paulo and Rio De Janeiro
-

Changing Distributions
a. MDCs have been losing the steel and textile industries to LDCs.
(1) In 1980, 80% of the worlds steel was produced in MDCs. By 2008, MDCs only produced 40% of
the worlds steel.
i.
Europe 50% to 23%
ii.
North America 20% to 8%
iii.
China 38%
(2) Between 1990 and 2009, most apparel sold in the US switched from domestic-made to foreignmade
US mills pay workers $10-$15
European mills pay workers $30

Seth Adler
-

LDC mills pay workers $1

Outsourcing
a. Transnational corporations are aggressive when using LDC workers.
b. New International Division Of Labor The transfer of jobs from more developed to less developed
countries.
(1) Typically low-paid and less skilled workers
c. Outsourcing Turning over much of the responsibility for production to independent suppliers.
(1) Contrary to vertical integration, in which a company controls all phases
(2) For example, carmakers have outsourced the production of seats to foreign countries and then
installed in the US.

B. Renewed Attraction of Traditional Industrial Regions

a. Companies stay in their original locations for skilled labor and speedy delivery.
1.

Proximity to Skilled Labor

a. Henry Ford once said that he could take people off the street and get them to work in a factory. This has now
changed since many want skilled workers.
b. Computer Manufacturing requires skilled labor.
(1) Near the Bay Area of California and the University of Texas
c. Fordism Production Workers performing one specific task to perform repeatedly.
(1) Ford Motor Company was one of the first to organize its production this way in the early twentieth century
d. Post-Fordest Production Workers follow a lean or flexible production approach.
(1) Teams.
a. Workers are placed in teams and told to figure things out for themselves.
(2) Problem solving.
a. A problem is addressed within themselves, rather than writing a complaint to the head office.
(3) Leveling.
a. Factory workers are treated the same as managers and veterans.

2.

Just-in-Time Delivery
a. Because of the rise in just-in-time deliveries, proximity to the market is very important.
b. Important for the delivery of inputs.
(1) Arrive at factories daily or hourly
(2) Suppliers are told a few days notice.
c. Reduces the money that would have been spent on inventory.
(1) Reducing the size of the factory
d. Wal-Mart has little inventory, but its suppliers have a lot, just in case a sudden surge is needed.
e. The only problem with this are 2 disruptions:
Labor unrest.
a. A strike at a plant or truck union can shut down production.
Acts of God.
a. Includes weather-related events.
(1) Blizzards or floods that close highways
b. 9/11 stopped all air traffic in the United States.