The Quaternary Sector

Monday, October 22, 2012

Today’s mental workout kicks off this week’s agenda, exploring the Quaternary sector, the knowledge-based, information generating and sharing part of the economy in the 21st century. Throughout the week, we’ll delve into how to harness the necessary skills to take advantage of the emerging opportunities. As we’ve mentioned on this forum, the world continues to undergo a rapid transformation, there are jobs and industries impacted by the Great Recession that are not likely to return. To thrive in the new world, you must shift your mindset. Economic growth is limited from the primary and secondary sectors of the economy. Primary resources, manufacturing, agriculture and construction are losing significant ground, automation and innovation has transformed the entire world. The engines of growth are dependent on the Quaternary sector, knowledge-based part of the economy. The GDP contribution of the primary and secondary sectors have been on a downward curve for the past decade and will continue to see decline. The service sector has been flat due to the Great Recession felt everywhere around the world.

Why the quaternary industry is important for economic growth.

There is no doubt that the quaternary sector of any economy holds the vital keys to economic growth and prosperity. First let’s define the quaternary sector, it pertains to the knowledge-based workers, those in consulting, science, information technology, web services, internet marketing, research and development, financial planning, education, strategic business services and other knowledge-based services. This particular sector holds the key to economic growth due to the infinite power of the mind. If we use Facebook as an example, we can see the significant impact of a college student using meager campus resources has the brilliance of mind to launch a company that would change the entire world. A company that might yet change how business does marketing. Everywhere in the world, there’s potential of how a kid in a dorm room can change the world, it’s not necessarily going to be the top MBA graduate providing all the answers the professors want to hear. Somewhere in the world under the early stages of development could be the next transformative game-changer.

Significant advantage of Quaternary Sector start-ups

As soon as worldwide access to capital tighten, banks and lending institutions are less likely to loan money out for start-up capital in the industries that require huge capital investment to get off the ground. Therefore the quaternary industry because of its strategic and dynamic start-up advantages must make up the growth margins vacated by the other sectors. The quaternary industry is crucial because of its lower need for capital to begin. No huge investment of capital is needed to launch such enterprises, in fact the entrepreneurs pride themselves in their ability to use their knowledge to keep costs at a minimum. The companies in this sector have the capability of generating higher margins of returns on investment due to their low overhead. There’s now more incentive for universities around the world to concentrate more resources on developing incubator programs that can help knowledge-based start-ups. Innovation usually fosters rapid growth, the quaternary sector is geared towards productivity and forward-thinking strategies, the relentless pursuit to convert knowledge into measurable progress. Tomorrow’s mental workout will discuss positioning in the new world Quaternary sector, as always make it an information generating mental workout.