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Chapter 6

SOC341H5 Chapter Notes - Chapter 6: Information Society, Deindustrialization, Lean Manufacturing

by Maya

Course Code
Mark Easton

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Castells “Post-industrialism, the service economy, and the informational society” pg 218-
The theory of post industrialism has 3 predictions
o The source of productivity and growth lies in the generation of knowledge that is
spread through information processing
o Economic activity would shift from goods production to services delivery
Agriculture and manufacturing jobs will decline
Service jobs will be the largest proportion of employment in these
o The new economy would increase the importance of occupations with a high
information and knowledge content in their activity.
Eg. Managerial, professional, and technical occupations
Criticism of the first prediction: The appropriate distinction is not between an industrial
and a post-industrial economy, but between two forms of knowledge-based industrial,
agricultural, and services production
The author shifts from a post- industrialist perspective, to a informationalist perspective
o In this perspective, societies will be informational, not because they fit into a
particular model of social structure, but because they organize their production
system around the principles of maximizing knowledge-based productivity
through the development and diffusion of information technologies, and by
fulfilling the prerequisites for their utilization (primarily human resources and
communications infrastructure).
Criticism of second prediction:
o it is an obvious fact that most employment in advanced economies is in services
o yet it does not follow that manufacturing industries are disappearing or that the
structure and dynamics of manufacturing activity are indifferent to the health of a
service economy.
o while analysts were pro- claiming the de-industrialization of America, or of
Europe in the 1980s, they simply overlooked what was happening in the rest of
the world, global manufacturing employment was at its highest point
o overall, new manufacturing jobs elsewhere largely exceeded the losses in the
developed world. *
o Furthermore, the notion of “services” is often considered to be ambiguous at best,
misleading at worst
o the category of services includes activities of all kinds, historically originated
from the category of services includes activities of all kinds, historically
originated from
o In understanding the informational economy, each one of the specific categories
of services becomes as important a distinction as was the borderline between
manufacturing and services before.
Criticism of third prediction
o There is not just growth at the high skilled occuptions, rather there is also the
growth of low-end, unskilled, service occupations.
o These low-skilled jobs, despite their slower growth rate, may represent a
substantial proportion of the post-industrial social structure
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o where the top and the bottom increase their share at the expense of the middle
o the notion that knowledge, science, and expertise are the critical components in
most of the managerial/professional occupations is challenged
The most important critique challenges the notion that these 3 assumptions merge in
historical evolution and that this evolution leads to a single model of informational
society *
Author attempts to differentiate between different service activities in different G7
distributive services refer both to communication and transportation activities, as well as
to commercial distribution networks (wholesale and retail).
Producer services refer more directly to those services that appear to be critical inputs in
the economy, although they also include auxiliary services to business which may not be
necessarily highly skilled.
Social services include a whole realm of government activities, as well as collective
consumption-related jobs.
Personal services are those related to individual consumption, from entertainment to
eating and drinking places.
The transformation of the employment structure 1920-170 and 1970- 1990
The major analytical distinction between the two periods stems from the fact that during
the first period the societies under consideration became post-agricultural, while in the
second period they became post-industrial.
all G-7 countries maintained or increased (in some cases substantially) the percentage of
their employment in transformative activities and in manufacturing between 1920 and
1970. *
the shift in the structure of employment in this half-century (192070) was from
agriculture to services and construction, not out of manufacturing.
in the 197090 period, the process of economic restructuring and technological
transformation which took place and led to a reduction of manufacturing employment in
all countries *
while this trend was general, the shrinkage of manufacturing employment was uneven,
clearly indicating the variety of social structures according to differences in economic
policies and in firms’ strategies.
England and Wales became post agricultural in 1921
The United States, Germany, and Canada still had a sizeable agricultural population
(from a quarter to a third of total employment), and Japan, Italy, and France were
dominated by agricultural and commercial occupations.
From these differential starting-points, trends converged toward an employment
structure characterized by simultaneous growth of manufacturing and services at the
expense of agriculture.
o These different countries were able converge at the same time because of the
rapid industrialization in Germany, Japan, Italy, and France, which distributed the
surplus of agricultural population between manufacturing and services.
Only the U.S and Canada, saw an significant increase in the proportion of service
employment during the post agricultural period
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All other countries followed the same tendency, but at different speeds, thus reaching
different levels of de-industrialization.
the trend toward information processing is not a distinctive feature of the United States:
the American employment structure is set apart from the others as a “service economy”
than as an “information economy.”
Japan, the society which puts the strongest emphasis on information technologies, and in
which high technology plays a most significant role in productivity and competitiveness,
also appears to have the lowest level of information-processing employment, and the
lowest rate of progression of such employment.
Japan and Germany, the two most competitive economies among major economies in the
1970s and 1980s, are those with the strongest manufacturing employment, the lowest
service to industry employment ratio, the lowest information to goods employment ratio,
and, for Japan (which has experienced the fastest productivity growth), the lowest rate of
increase in information employment throughout the century.
information processing is most productive when it is embedded in material production or
in the handling of goods, instead of being disjointed in a stepped-up technical division of
if information is a critical component in the function- ing of the economy and in the
organization of society, it does not follow that most jobs are or will be in information
information employment is at a slower pace, and reaching much lower levels, than the
trend toward service employment
evolution of each category of service in each country
producer services: they provide information and support for the increase in the
productivity and efficiency in firms
o throughout the two periods (19201970, 19701990) a significant expansion of
employment in these activities in all countries.
o The two most dynamic economies (Japan and Germany) have the lowest rate of
employment in producer services, while it is obvious that their firms do use such
services in great amount, yet with a different organizational structure that links up
producer services to the production process.
While it is evident that producer services are strategically crucial in an advanced
economy, they still do not represent a substantial pro- portion of employment in most
advanced countries, in spite of their rapid rate of growth in several of them
It seems that the expansion of producer services is linked to the processes of vertical
disintegration and outsourcing that characterize the informational corporation.
Social services: with the exception of Japan, employment in social services represents
between one-fifth and one- quarter of total employment in the G-7 countries
o Social services increased around the time of large social movements (60’s)
o U.S, Canada and France, had moderate rates of growth in this area but Germany,
Japan and Britain had high rates in 1970-1990
o although the expansion of social services employment at a very high level is a
feature of all advanced societies, the pace of such expansion seems to be directly
dependent on the relationship between the state and society, rather than on the
stage of development of the economy.
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