A basic industry is an industry that focuses on the production of products and services for export, rather than for domestic sales and circulation. Such industries play a key role in their regional economies and sometimes occupy an outsized portion of the market share. This can create problems in the event of a failure of an export industry, or when political situations change and limit the market for exported goods. Most nations maintain statistics on their import and export activities, and keep a close eye on their basic industries.
Activity in the basic industry sector actively encourages the inflow of foreign monies. When companies export, they receive money from new sources in return and can invest this in job creation and development. Domestic circulation of products and services tends to have a limited market, and while money may shift within the market, large injections of capital from outside sources are not available. In basic industries, outside wealth flows into a nation, and may be accompanied by expertise, positive relations, and so forth.
Basic industries can produce a wide variety of goods. One example is grain in the Midwest of the United States. Much of the corn, soy, and wheat grown in the United States is a basic industry produced specifically for export, not for domestic use. These goods are sold overseas to nations with inadequate production of their own. Some of these nations in turn produce goods that wind up in the United States, like finished tofu made from soy beans.
Economically, basic industries can be an important part of the national economy. The demand for goods and services from overseas also impacts the global economy. At every step of the way from basic industry to end consumer, middlemen profit from activities like shipping goods from one location to another, storing them, and repackaging loads for sale in new locations. This can create a lively economic chain that may falter in the event of a problem at one end of the distribution.
Companies can determine the best mix of export and domestic sales for their needs. Some try to split the two roughly evenly, while others may focus on one or the other. Domestic demand may be inherently limited, while basic industries can take advantage of demand from a wide variety of locations to create a steady market for their products. This flexibility can also become a threat when a local economy becomes reliant on a basic industry, as people may suffer disproportionately if the industry starts to struggle.
What Companies Are in the Basic Industries Field?
If you are considering a new career, or if you're trying to decide on a major in college, you may have come across the term "basic industries". Basic industries are simply the industries that supply raw materials to other fields of manufacturing and production.
Is basic industries a good career path? If you've noticed that there are several different types of work that can be considered "basic", you're correct. This term does not refer to one industry (or even one type of industry, such as metallurgy); instead, it refers to industries that create and manufacture products that are meant to be distributed outside of the local economy. In contrast, non-basic industries' products and services are used locally. Basic industries may include the following types of companies:
- Agriculture such as wheat, soy, and corn production
- Fruit orchards and vegetable farms
- Raw materials such as iron and steel
- Forestry, logging, and mining
Basic industry products are often exported rather than used domestically, and they bring money into the local economy, while non-basic industries simply recirculate the money already available in the local economy. For example, a non-basic industry may include a hairdresser's salon, a local restaurant, or a small business.
How Many Jobs Are Available In Basic Industries?
In 2020, there were over 22,000 jobs in the basic industries. Keep in mind that these fields are diverse and wide-ranging; they can include any industry in which the product is not used to supplement the local economy. The end result of the product may return to the local economy, though: Consider a case in which soybeans are grown on an American farm, harvested and exported somewhere abroad, and returned as packaged tofu products for the local supermarket. This is a good example of how the same product may play different roles in the local economy.
Examples of Basic Industry Career Paths
If you are considering a career in one of the basic industries, you may have assumed until this point that your only options involved smelting or farming. This isn't the case! Consider the following career options for those who wish to work in the basic industries:
These professionals work with farmers and those who grow and harvest large-scale crops. This job may net you an average salary, but it will be steady work and you will get to use your knowledge of crops as well as your management skills during your career.
These individuals can make six figures a year working with petroleum geologists to oversee and manage the natural gas and oil extraction process. If you're planning on going into this field of work, you should have great communication skills as well as practical, on-the-job knowledge.
As the name implies, this professional works with different types of metals. He or she may work with miners and frequently visit the sites at which the mines process their materials. These individuals should have a good working knowledge of metals, chemistry, and safety skills needed for this occupation.
Health and Safety Officers
When employees in the basic industries receive their initial training, they are often warned of the risks and hazards involved in their jobs. Miners, for example, work in dark, below-ground conditions that often pose threats to their safety. Those who work with metals, large farm equipment, or chemicals of any type need to know how to do their job safely or they could be injured. Health and safety officers oversee the training procedures and protocols for on-the-job safety at each site, and they are also responsible for documenting work-related accidents.
Related Business Services
If you plan to study business, or if you're thinking about transitioning to a basic industries career with a business or finance degree, you're in luck. The basic industries, like most other fields of work, need people with extensive knowledge of business, manufacturing, marketing, and finance.
Is Basic Industries a Good Career Path?
The above job descriptions are but a few of the career paths available within the basic industry. While many positions in the basic industries are not considered to be lucrative according to national standards, they can provide job security and stability. The Bureau of Labor Statistics expects that jobs in the basic industries will grow by 2.7% over the next 10 years. This industry is not expecting a boom in growth, but it is increasing at a steady and predictable rate. This makes it an excellent career choice for those who wish to work with the materials and products that support the fabric of our daily lives.