ADVANTAGES AND DISADVANTAGES OF THE DE-INDUSTRIALIZATION PROCESS FOR THE WORLD ECONOMY

Abstract

The study of the phenomenon of de-industrialization and its impact on the world economy is presented. The main advantages and disadvantages of the deindustrialization process for the world economy are highlighted. The purpose of the study is to find out the advantages and disadvantages of the de-industrialization process for the world economy. A characteristic feature of the economies of developed countries in recent decades has been the dramatic shifts in both employment and gross domestic product. A common phenomenon was the diminishing role of the industrial sector and the growing importance of the service sector, known as “de-industrialization”. The main factors that have led to structural transformations in the European economy that have led to de-industrialization are changes in the structure of consumer demand and spending, faster productivity growth in industry compared to the service sector and, as a result, the shift of jobs from industrial to service sector, shifting production to countries with cheap labor. De-industrialization in Europe and Asia is not exactly the same: most industries have lost their jobs, but they have continued to increase productivity and gross value added. Nonetheless, de-industrialization is seen as a trend that cannot but be a source of concern and needs adjustment to support industrial development, which is closely linked to other sectors of the economy and remains an important source of innovation and economic well-being.