Purpose of using these specific examples in this module
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- Industrial development and changing industrial location in the Great Lakes Region
- Measures taken to develop the Great Lakes Region in a more sustainable way
References: Andy Palmer, Nigel Yates (2005). Advanced Geography. Oxford: Philip Allan Updates. David Redfern, Malcolm Skinner (2003). Advanced Geography. Oxford: Philip Allan Updates. BIS Economics Paper No. 10A Manufacturing in the UK: An economic analysis of the sector (December 2010) Department for Business Innovation & Skills https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/31785/10-1333-manufacturing-in-the-UK-an-economic-analysis-of-the-sector.pdf
The future of UK manufacturing: Reports of its death are greatly exaggerated Observations, analysis and recommendations – April 2009 PriceWaterHouseCoopers http://www.pwc.co.uk/assets/pdf/ukmanufacturing-300309.pdf
BIS Economics Paper No. 18 Industrial Strategy: UK Sector Analysis (Septeber 2012) Department for Business Innovation Skills http://www.bis.gov.uk/assets/BISCore/economics-and-statistics/docs/I/12-1140-industrial-strategy-uk-sector-analysis.pdf
The guardian - manufacturing data http://www.guardian.co.uk/business/manufacturingdata 
Industrial development and changing industrial location in the Great Lakes Region The US Great Lakes Region is located in the northeastern part of US. It is made up of the area around five lakes, namely Lake Superior, Lake Michigan, Lake Huron, Lake Erie and Lake Ontario (Figure 3). It covers the states of Ohio, Indiana, Michigan, Wisconsin and Illinois. With the region having rich natural resources such as copper, iron and gold, and the lakes providing good water transportation, industry developed rapidly in this region. In the early years, there were industries like lumber production, steel mills and shipbuilding. In the late 1890’s automobile industry started in the area. The most famous automobile city is Detroit where Ford is the famous brand. Such development further attracted more industries such as those which provided parts for automobiles. Other services such as banks and trading firms were also attracted. This produced the agglomeration economies and the area has been developed into a big manufacturing belt. More industries like publishing and printing, chemicals, furniture, garment and agricultural machinery were also attracted but auto manufacturing and steel production continued to be the most important industries in the region.
Figure 3 The location of the Great Lakes Figure 4 shows the number of manufacturing jobs in the Great Lakes Region. It can be seen that the number of manufacturing jobs has been decreasing since 2000. This is because more and more industries have moved out from the region. Most of them have been moved to other countries. The major reason for this phenomenon is due to the lower production cost in the less developed countries such as Malaysia, China and Thailand. In addition, these countries offer incentives for foreign enterprises to set up factories in their countries. They also do not have a strict environmental control. With the growing globalization trend in manufacturing industry, US local industries lost their competitive power as production costs will be cheaper if produced outside the USA. 
Figure 4 Number of manufacturing jobs in the Great Lakes Region (1969-2009) For the automobile industries, they moved out of the region because of some other reasons. The headquarters of the firm is still in charge of the research and design of motor vehicles, and the management of the whole production process and procedures. However, suppliers of parts have taken a more important role in the design of parts. They established their own design centers close to different markets of motor vehicles so that they can easily alter the design to fit the specific requirements of the local market. Besides, since the parts are large, heavy and fragile, their transportation costs are high. Therefore, automobile firms will set up regional assembly plants in different places to serve the respective local markets. In view of all these changes in production, many factories in the Great Lakes Region have been moved out or ceased production. As a result, many factory workers were unemployed. It has also produced chain reaction affecting other related industries and services. The local economy is worsened with the decrease in salary on the whole. Measures taken to develop the Great Lakes Region in a more sustainable way Revitalizing industrial development in the Great Lakes Region In order to revitalize industrial development in the region, the federal government has provided subsidies for the development of new types of industry. Industrial development in the Great Lakes Regions shifts from the traditional manufacturing sectors to new high–technology industries and services. For example, in 2009, the US Federal Government injected US $2.5 billion to assist the production of lithium-ion batteries which can be used in mobile phones, laptops and hybrid automobiles. The industry has quickly developed because there is already a pool of skilled and well educated workers available in the region. Such development created a lot of job opportunities because the manufacturing of lithium-ion batteries needs to employ a lot of people, including scientists to conduct research and development to improve industrial materials, contractors to supply machinery for production, as well as designers, engineers and machine operators for the operation of the factories. It is estimated that the manufacturing of lithium-ion batteries employed about 65% of America’s scientists and engineers. Besides local industrial development, some transnational companies (TNC) are also attracted to re-establish their manufacturing plants in the region. For example, Toyota of Japan has set up their assembly plants in the Great Lakes Region in order to avoid the heavy tariff that they needed to be paid if produced abroad. They can also tailor-made their products to suit local demand. The arrival of TNCs decreases unemployment and injects capital to stimulate the local economy. Local people with more disposable income will create a demand for more housing, transport, and services. All these promote the growth of the local economy in different sectors. 
Development of other types of economic activities In order to sustain the economic development of the Great Lakes Region, the state governments of the region search for different ways to boost the economy of the region. Since the Great Lakes have beautiful scenery, beaches and water resources, tourism begins to develop. The state governments put in a lot of effort to keep the water in the Great Lakes clean to facilitate the development of tourism and its associated services. Industries are required to invest more to lower the level of pollution. For example, the British Petroleum (BP) spent about $1.4 billion in their $3.8 billion construction cost on environmental controls. New trends in industrial development Although many industries have moved out of the Great Lakes in searching for low-cost location, such trend has been changing in recent years. More manufacturing industries are coming back as the favourable factors of some of the overseas production centres are diminishing. For example, China has been a country where most TNCs have established their factories. However, the wages in China is rising. Average wages increases by 150% from 1999 to 2006. From 2005 to 2010, average wages in China rose by 19% per year while wages in US rose by 4% only. When comparing the labour productivity between China and US, the labour productivity in China is obviously lower. So the efficiency in the productivity of labour in US may outweigh the saving from labour cost. This may affect the choice of location for those industries whose labour cost does not occupy a large proportion in their total cost. For the other low-cost locations such as Vietnam, Thailand and Indonesia, although their labour cost is lower than that of China, their infrastructure and supply network is poorer and labour productivity is even lower. So these countries may only favour the location of those labour-intensive industries that require less skilled workers. As recent manufacturing has placed more importance on the contact with customers so that the design of products can be tailored to suit local demand, US can be an increasingly attractive option for industry as it is close to the markets in North America. Therefore, there is a trend that more industries are moving back to the Great Lakes.
References: About our Great Lakes: Economy http://www.glerl.noaa.gov/pr/ourlakes/economy.html A leaner, more skilled US manufacturing workforce http://www.newyorkfed.org/research/current_issues/ci/2-2.pdf Bearing the Brunt: Manufacturing job loss in the Great Lakes Region, 1995-2005 http://www.brookings.edu/research/reports/2006/07/useconomics-wial Chicago: Economy http://www.city-data.com/us-cities/The-Midwest/Chicago-Economy.html Chicago’s Southeast side Industrial History http://naturalsystems.uchicago.edu/urbanecosystems/calumet/cdrom/photos%20and%20maps/Rod's%20SE%20Side%20Hist%20slide%20show3.pdf Encyclopedia of Chicago – Economic Geography http://www.encyclopedia.chicagohistory.org/pages/409.html Federal Reserve Bank of Chicago: Great Lakes’ manufacturing job loss in perspective http://midwest.chicagofedblogs.org/archives/2012/02/great_lakes_man.html Globalization of the automotive industry: main features and trends http://www.econ.kuleuven.be/public/n07057/cv/smvg09ijtlid.pdf Great Lakes see a future beyond industry http://usatoday30.usatoday.com/news/nation/2007-12-03-GreatLakes_N.htm?loc=interstitialskip History of Michigan – Industrial development http://history.howstuffworks.com/american-history/history-of-michigan3.htm Made in America, Again: Why manufacturing will return to the US http://doingwhatmatters.cccco.edu/portals/6/docs/Made%20in%20America%20Again.pdf Manufacturing isn’t dead in the Great Lakes Bay Region http://www.nexteer.com/in-the-news/manufacturing-isnt-dead-in-the-great-lakes-bay-region The New York Times: Does America need manufacturing? http://www.nytimes.com/2011/08/28/magazine/does-america-need-manufacturing.html?pagewanted=all&_r=0 Vital to our nation’s economy: Great Lakes jobs 2011 report http://www.fws.gov/glri/documents/11-203-Great-Lakes-Jobs-report[1].pdf Directory: attachment attachment -> A unified Modeling Approach to Climate System Prediction James Hurrell* 1, Gerald A. Meehl 1, David Bader 2 attachment -> Voluntary and mandatory surrenders 2013 Download 0.75 Mb. Share with your friends:
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