Setting Up Industries - Development through a Chain Reaction
Posted in Finance Articles, Total Reads: 1103
, Published on 26 January 2014
The biggest challenge that emerging economies are facing in generating employment for their citizens. Most of the emerging economies including the mighty BRIC nations have a huge population who are the "young population" I.e. below 30 years of age. Thus is it a massive challenge for the Governments of these nations to provide a job to this young workforce. Metropolitan cities are overcrowded, with intense competition for jobs, lack of basic amenities, unplanned infrastructure etc. All these factors add to the woes of the governments. However, there is one way which can prosper growth through development in under-developed areas, by creating opportunities to the people.
Development in a certain area leads to creating opportunities for a lot of other businesses and services to grow parallelly. Setting up of industries or MNC offices in a particular area or society leads to a chain reaction thereby opening avenues for other people to become a part of offering services, thereby generating employment opportunities.
Image Courtesy: freedigitalphotos.net, David Castillo Dominici
Let us consider a few examples to elaborate the same. Consider a small town with a small population surrounded by a few villages. The basic opportunities for the people of this area are confined to small scale services and agri-based jobs. Now, when an industrial plant or a company office is opened in this area, the opportunities percolate down to the people of this area.
Setting up of the industry would bring employees to come and stay in this area. This would open up the realty business and give a push to the construction industry for accommodation of the employees of the company. Food chains would come up in the surrounding areas for providing cuisine options to the employees. This would inturn benefit the agri-based businesses. Services like domestic help, barbers, cobblers, chauffeurs etc would also flourish. The transport industry would also come up with private taxi and cab players offering their services. Not only this, it also leads to prosperity of elite jobs like doctors, dentists, banking etc. Thus, setting up of an industry gives rise to a chain reaction, the benefits of which percolate down to the lower sections of the society in terms of employment opportunities.
Another example for a similar development-based chain reaction is the tourism industry. Promotion of a particular tourist destination adds tremendous value in creating employment opportunities to the people in the surrounding areas. Travel agencies gain the maximum as the need for transportation in and around a tourist spot is high value. Resorts, lodges, hotel chains etc benefit from booming tourism thereby giving employment opportunities to caterers, housekeeping staff, security personnel etc. Indirectly, these opportunities also lead to requirement of other services like cinemas, entertainment hubs etc. Tourism industry also promotes the local handicraft, man-made products, thus giving endless opportunities for people to prosper.
Industrial development has always lead to generating employment opportunities for people. The workforce of any organization, if provided with the correct platform, tend to prosper. However, the bigger impact that an industry has is on the society as it opens up innumerable opportunities. Thus, just by simply setting up of industries in an untapped area causes a chain reaction, creating multiple employment opportunities for the people.
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