What Is Sectors ?

A sector is an area of the economy in which businesses share the same or related business activity, product, or service. Sectors represent a large grouping of companies with similar business activities, such as the extraction of natural resources and agriculture.

Dividing an economy into different sectors helps economists analyze the economic activity within those sectors. As a result, sector analysis provides an indication as to whether an economy is expanding or if areas of an economy are experiencing contraction.

In the financial markets, economic sectors are broken down even further into sub-sectors called investment sectors. Investment sectors represent a grouping of companies with similar business activities. Examples of investment sectors include technology, energy, and financial services.

This article explores the main types of economic sectors and the business activity associated with them, and how investment sectors play a role in determining a nation's economic conditions.

• Sectors are used to categorize the economic activity of consumers and businesses into groupings based on the type of business activity.
• Primary sector companies are directly engaged in activities utilizing natural resources, such as mining and agriculture.
• Secondary sector companies produce goods derived from the products within the primary sector and include manufacturing.
• Tertiary and quaternary sectors represent the services and knowledge-based economy and include retail and information technology.
• In the financial markets, investment sectors are sub-sectors that aid in comparing the financial performance of similar businesses.