Lesson video

Hello, my name is Chloe and I'm a geography field studies tutor.

This lesson is called The Causes of Economic Change, and it forms part of the economic futures in the UK unit.

We're gonna look at how the UK economy has changed, how different industries have influenced the UK over time, and what that might mean for the future of the UK as well.

Let's begin.

By the end of this lesson, you'll be able to describe the main causes of economic change in the UK.

There are some key words that we need to review before we get started.

First of all, the term de-industrialization.

This is the decline and loss of traditional forms of industry.

Those traditional industries are labour-intensive industries such as coal mining, steel and textile production, and ship building.

Globalisation is an increased connectedness between different countries that spreads money, ideas, goods, and people.

And finally, privatisation the takeover of state run industries by private corporations.

This lesson is in three parts.

We're gonna answer three different questions.

First of all, how has de-industrialization caused change? How has globalisation caused change? And then finally, how have policies caused change? Let's start with that first one about de-industrialization.

The structure of the UK economy has changed significantly since 1800.

Let's have a look at the graph we have here.

It starts in 1800 and goes through to the present day.

We've got three different sectors listed here, primary, secondary, and tertiary.

Primary industries such as agriculture and coal mining employed the majority of UK workers in 1800.

You can see that by the purple line.

It sits quite high above the other two on the graph.

This declined as the UK started to build a manufacturing or secondary sector.

And you can see that green line is starting to rise up at the same time as the purple line is coming down.

This is known as the pre-industrial era.

During the late 1800s and the early 1900s, manufacturing boomed in the UK.

Employment in the tertiary or the services sector also increased while primary industries continued to decline.

You can see that purple line took a sharp decline in that period.

This is known as the industrial era.

The UK then went through widespread de-industrialization, which saw employment in the manufacturing industries start to decline.

You can see that green secondary line.

It had a sharp increase in the amount of people it employed, but then we also saw a sharp decrease straight afterwards.

By 1950, the primary industries employed less than 20% of the workforce.

You can see that purple line is now languishing right at the bottom.

Employment in the tertiary sector grew rapidly from 1950 as work in the manufacturing and primary industries continued to decline.

You can see the blue line here has extended right the way to the top of the graph.

This is known as the post-industrial era.

In the early 2000s, employment in the quaternary sector began to grow with an increase in jobs in science and technology as well as in IT and web services.

That pink line has now entered into the graph and you can see actually that it's rising quite steeply and starting to compete with secondary employment.

Let's check our understanding so far.

Which era saw a boom in manufacturing industries in the UK? You can refer to the graph here.

Is it A, the pre-industrial, B, the industrial, or C, the post-industrial.

Pause the video here and have a think about that.

Well, well done if you can remember and recognise from the graph.

Yeah, it's that green line and you can see that it's at its peak around 1900, the peak of the industrial revolution, and that is our industrial era.

Well done.

De-industrialization had a deep impact on the UK.

Throughout the period of de-industrialization, the UK saw the decline and in some cases the complete loss of traditional industries such as coal mining, textile, and steel production and ship building.

It could be argued that it was these industries that built the wealth of the UK over the previous 150 years.

All of the UK was affected by de-industrialization, but different areas experienced it at different times and in different ways.

So for example, London was the first area to establish itself as a centre for tertiary industries, especially in the financial services.

But if we go to a different part of the country, like the Northeast, that continued to rely on traditional industries such as mining until the 1980s and 1990s.

So quite different economies were taking place at the same time in the UK.

Now there are many reasons for the de-industrialization of the UK economy.

First of all, technological developments such as we can see here in the picture, but that increasingly machines like combine harvesters could do the heavy labour that was once required of people.

Where an industry did require a human labour force, it became cheaper to employ workers overseas, and this is known as outsourcing.

So jobs that would have once been held in the UK were now being found overseas at a much more competitive price.

Raw materials and the cost of premises were also cheaper outside the UK.

So to maintain profits, whole production processes were moved overseas.

Factories that would've once been in the UK were shifted entirely to other countries.

Hard labour in factories and on the land became less attractive for increasingly highly educated graduates.

When they started to become qualified, they were looking for jobs in other areas.

So true or false.

Changes in the economy affected all areas of the UK in the same way.

Pause the video and have a think, is that true or false? So hopefully you've recognise that that is false, but why is that a false statement? Yes, some cities like London created employment opportunities in the tertiary industries, the service industries, while areas like the northeast of England maintained a significant amount of employment in the primary sector.

In the Northeast, it was mostly in the mining areas.

So here's your first practise task of this lesson.

Think about the different changes that have caused de-industrialization.

Write a sentence that describes one of these changes.

Then write a second sentence that explains how that change caused de-industrialization.

So think carefully about what the difference is between a description and an explanation.

Choose one of those causes of de-industrialization and write a two sentence description and then explanation.

So let's see the kind of thing you could have written.

So for my description, I could have written something like technological developments produced new and more efficient machinery.

Now for my explanation, I'm gonna have to say, what kind of impact that had in relation to de-industrialization.

So my explanation is this machinery could replace workers leading to a decrease in employment in manufacturing industries.

It's clearly made that link between the technological development and the de-industrialization.

Let's look at some other examples of the kinds of things you could have said.

So you could have said it became cheaper to employ overseas workers in manufacturing.

My explanation would be then this meant that companies could outsource their labour leading to reduced employment in manufacturing in the UK.

You could have talked about raw materials and premises and how they are cheaper overseas as well, and explain that to say this meant that companies based in the UK moved their operations completely to countries outside the UK reducing employment in this sector.

Let's move on to the second part of today's lesson.

How has globalisation caused economic change? A key element of globalisation that has affected the UK economy is the rapid development of communication technology.

The internet allows instant communication via email, social media, and video conferencing.

International bank transfers can occur quickly and the tracking of world stock markets can happen through your smartphone.

With the rise of international online banking, however, there has also been an increase in cybercrime.

Having instant connections to other countries has allowed large companies to expand their operations.

It's now possible for workers to collaborate across continents.

In 2022, it was estimated that 30% of the UK workforce were working remotely from their employers main address.

Aisha says here, "My mom now works for an international bank, but she never has to go anywhere.

She works from home.

It means she has more time with us as a family.

She hasn't got to spend hours travelling to and from work every week." Let's have a look at our understanding so far.

Complete the sentences with the missing words.

Have a look at the paragraph and see if you can fill in the blanks and then come back to me.

So let's check your understanding there.

The UK economy has been greatly affected by developments in.

Well done, communication technology.

This means workers in the UK are more connected to workers in other countries.

Email and video calling have transformed the workplace with an estimated 30% of people working remotely in 2022.

Goods, some of which have been manufactured in the UK, are now imported from all over the world.

Many foods that we eat every day also come from other countries.

Laura is saying here to Jacob, "My favourite fruit are strawberries and they grow in the UK." But Jacob points out, "But only in summer the fruit only grows then.

The rest of the year, the UK mostly imports those strawberries from other countries." Maybe this is something for you to think about when you look at the foods that you are eating.

The increase in global trade has meant that some UK companies are now in competition with those from overseas.

This increases the pressure on UK companies to find cheaper labour and materials from other countries in order to maintain profits and remain competitive in the global marketplace.

Our graph here is showing just how rapidly imports have risen in the UK from 1970 to 2022.

You can see it's been a really rapid increase in the amount of things that are coming into the UK from overseas.

As the tertiary sector grew, globalisation also brought foreign investment in services to the UK.

For example, international banks began to set up their regional headquarters in the UK and especially in London.

Some overseas employees also migrated to the UK, but the growth in the sector has also created new opportunities for UK workers.

It was not, just the case, that international banks came to the UK and brought all their workers with them.

They created new jobs too.

Andeep here is saying, "Great.

So globalisation brings some well paid jobs to the UK." But what Sofia got to reply to that? She says, "Yes.

However, it's unlikely that the long-term profits from these big banks will stay here." There's always another side to think about.

So true or false.

Globalisation has reduced employment opportunities in the UK through the outsourcing of labour.

Think carefully about the wording in that sentence.

Have pause the video and then come back to me and tell me whether that is true or false.

Okay, so is it true or false? It's false, but why? So hopefully, you can see that while globalisation has meant that many jobs in the secondary sector have been outsourced.

Foreign investment has increased the amount of other jobs in the tertiary sector.

So it's not the case that all employment opportunities have been reduced because of globalisation.

In some sectors it's reduced, but in other sectors it's increased.

Let's move on to our second practise task.

Match the change caused by globalisation to its appropriate advantage and disadvantage.

So in the dotted box in the middle, you can see you've got a change that has happened because of globalisation.

Improved communication systems, increased international trade or increased foreign investment.

What you then need to do is take each of those changes and match it to the advantage on one side and its correct disadvantage on the other side.

Do pause the video and have a really close read of those advantages and disadvantages and see if you can match them all up.

So let's take a look at your answers.

Let's start with that first change, improved communication systems. What's the advantage of that? Yes, well done.

It's meant that people have more flexibility over how and when they work.

For example, it means they could work from home.

But on the other side of things, improved communication systems also means there's possibly the increased amount of cyber crime taking place.

The second change increased international trade.

Well done if you recognise.

That means the UK receives goods from all over the world.

It means that we can get, for example, strawberries when they're out of season.

But the disadvantages, that means that UK companies are subjected to greater competition.

The UK companies are now effectively in competition with every other company in the world that's doing the same thing as them.

Finally, increased foreign investment.

Well, you can see there's only certain options left here.

So well done if you've got it right that it provides more jobs for people in the tertiary sector.

But the other side of it is yes, that profits from these sources are unlikely to stay in the UK.

Double check your answers and well done if you managed to get all of those correct.

We move on to the third and final part of today's lesson.

How have policies caused change? Until the 1970s, many UK industries were state run.

For example, all rail lines and trains came under a company called British Rail and all telecommunications were operated by BT.

Now this meant that the UK government controlled how they operated, but really importantly, when they were not profitable, they were subsidised by UK taxpayers.

So if those companies were going through some hard times, it was UK taxpayers that topped up their profits.

In the late 1970s and early 1980s, the government began to sell off these industries to private buyers in a process known as privatisation.

Other state corporations were reduced in size.

The government, for example, decided to close a number of mines that were run by the National Coal Board.

Now this decision created extreme unrest and over 140,000 miners went on strike in 1984 and 1985 in protest at the proposed closures and the loss of their jobs.

There's one image here from a picket line, a striker's line showing the kind of unrest and in some cases, extreme violence that took place 'cause people felt so strongly about this issue of privatisation.

In 1973, the UK joined the European Economic Community or the EEC, and this is like a forerunner to what we know as today, The European Union.

This meant the UK was part of a common market.

Now this is a trade agreement where goods and services are traded more freely between the member countries.

So normally, when countries trade goods, there's gonna be a tax called a tariff that has to be paid on imports.

If you have part of a trade agreement, it removes that tax between the countries.

So effectively, it should mean that the goods come to you at a cheaper price.

There are advantages and disadvantages of being in a free trade area.

Let's have a look at those now.

Now Izzy makes the absolute correct suggestion that if there are no tariffs to pay, goods from Europe are likely to be cheaper for consumers in the UK.

But there is the other side of this that Lucas points out.

If steel, for example, from Germany becomes cheaper than steel from the UK, that means that UK steel workers might lose their jobs.

All the UK is gonna be doing is importing the cheapest material rather than perhaps producing it themselves.

This means that there could be widespread job losses within the country.

Let's have a look at something we just learned.

Why did coal miners go on strike in 1984? A, was it to do with low levels of pay and long working hours? Were there poor working conditions with no regards for health and safety? Did they go on strike because there was a fear of job losses as the government began to close mines? Was their plans to import cheaper coal from European countries.

Pause the video and have a think about what we've just learned and come back to me with the right answer.

Now this is an interesting question because although there is one right answer, elements of the other answers are also true.

So yes, there were long working hours for miners.

There were, in some cases, very poor working conditions and health and safety concerns perhaps weren't at the same standard as they are today.

There were certainly plans to import cheaper coal from Europe.

But these weren't the main reasons why the miners were going on strike.

It was all about the idea that their jobs were gonna be permanently removed because the government was gonna be closing down coal mines.

By the 1980s, de-industrialization and government policies had left its mark on the UK economy.

This was especially the case in areas that had relied on traditional industries.

Many UK cities had old industrial areas that were eyesores and had large numbers of unemployed workers.

Scenes like this one were quite common in the 1980s in some cities.

Abandoned warehouses and factories littered many UK cities.

The UK government began a series of infrastructure projects to try to improve these areas and make them more attractive to new investments.

In 1981, London Docklands became the UK's first enterprise zone.

Low rents were established to attract financial services such as international banks to locate there, and it is now a global financial centre and definitely it's a symbol of London's wealth.

If you look at the image animation here, you can see what the Docklands area used to look like in 1981 compared to what it looks like today.

You can see the skyline has completely changed.

It's now filled with skyscrapers in an area you might know better as Canary Wharf, is the London Dockland areas.

In the 2000s, the UK government introduced a number of other regeneration schemes.

There are lots of them all over the UK.

These have aimed to reduce inequality between the southeast of England that had benefited from the rise of tertiary and quaternary industries, and the rest of the UK.

Many areas are still in need of regeneration decades after the loss of traditional industries.

Here's one of a regeneration scheme.

The Centre of Birmingham had a number of different projects that took place, one of them being the Central Library, and you can see how magnificent that building now looks.

Let's check our understanding.

Complete the sentences with the missing words.

Again, read the paragraph, see if you can come up with those missing words and then come back to me.

Right, let's look at your answers.

In the 1980s, many areas of the UK that had experienced de-industrialization had derelict industrial buildings and high numbers of unemployed workers.

The government began a series of regeneration projects that aimed to attract new private investment.

Our final task of today's lesson.

Complete the empty boxes on this timeline.

You can see you've got some starter sentences there indicating the kind of thing that was happening in each of those timeframes.

Have a read of what's already been written and then see if you can finish off those sentences so they make sense.

Pause the video and have a go.

Right, let's see the kind of thing you could have included.

In 1970, there are high number of state run industries such as British Rail running all the rail lines and trains.

There are lots and lots of examples you could have chosen.

In 1973, we've got the UK joins the EEC.

This gave the UK access to trade agreements.

This meant the member countries paid lower or no taxes when trading.

In the late 1970s and the early 1980s, the privatisation of state run industries caused strikes and protest, particularly in the coal industry.

And in the 1980s to 2000s, what did the government do there? They started to build new infrastructure projects and these aim to regenerate areas outside the south of England that had lost their traditional industries.

Even if your wording is slightly different, I hope you've got the right idea for each of those timeframes.

Let's summarise our learning today.

Over the past 200 years, the UK economy has changed from one where most people are employed in traditional industries such as coal mining and manufacturing to an economy based on service industries.

These changes have been caused by the combined influence of de-industrialization, globalisation, and UK government policies.

While some traditional industries have been lost, the UK has stronger connections to the global marketplace, and attempts have been made to encourage new investment in the area's hardest hit by de-industrialization.

There was a lot of new information there, but I hope that's given you a really good foundation for starting to learn more about the UK economy.

I'm well aware that the 1980s feel like a very long time ago for some of you, but remember, there'll be people in your community.

There may even be people in your family who were affected by de-industrialization and certainly will remember some of the minor strikes and some of the protests that took place with regards to privatisation.

Why not spend some time talking to them about what they remember, and you'll start to learn awful lot more than I can possibly fit into this video.