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Service Industries and Regions pp 339–364Cite as

A New Service Typology: Geographical Diversity and Dynamics of the German Service Economy

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Abstract

The heterogeneity of activities within the service economy still seems to be little understood. Service typologies are affluent yet incomplete and often partial in their focus. As a consequence, interregional comparisons and the development of evidence-based regional policies are rather difficult. In this chapter we improve an integrative typology of the service economy first developed in the Service Industries Journal (Glückler and Hammer, Service Industries Journal 31(6):941–957, 2011) in order to obtain a more concise and valid classification of service types that capture different sectoral and spatial dynamics of service employment relevant for regional policy. Concretely, the chapters pursues three objectives. First, it develops a classification of service sectors based on the criteria of market orientation, knowledge-intensity and technology-intensity. Second, it matches this integrative typology with three-digit NACE-codes of service sectors. Third, the empirical analysis demonstrates how this typology conveys significant differences in the spatial and sectoral dynamics of the service economy in Germany. Based on employment figures for the period 1999–2005, the analysis succeeds in separating employment decline from growth, geographical agglomeration from decentralization and regional expansion from local clustering in the service economy.

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Notes

  1. 1.

    The Nomenclature générale des activités économiques dans les Communautés Européennes (General Industrial Classification of Economic Activities within the European Communities) was first developed in 1970. Since this first taxonomy was not compatible with other international industry standards, a joint United Nations Statistical Office/Eurostat working group got involved in the third revision of the International Standard Industrial Classification of All Economic Activities (ISIC Rev. 3), which was adopted by the United Nations Statistical Commission in February 1989. Subsequently, a working group promoted by Eurostat with representatives of Member States developed a revised version of NACE, called NACE Rev. 1., which was established in 1990. In 2002, the minor update NACE Rev. 1.1 was established. NACE Rev. 1.1 introduced a few additional items and changes to some titles. The aim of the update was to reflect new activities which did not exist before (e.g. call centres) and activities which had manifestly grown in importance. In 2002, a new revision was initiated until 2007.

  2. 2.

    The NACE groups are defined as follows: E. Electricity, gas and water supply, G. Wholesale and retail trade; repair of motor vehicles, motorcycles and personal and household goods, H. Hotels and restaurants, I. Transport, storage and communication, J. Financial intermediation, K. Real estate, renting and business activities, L. Public administration and defence; compulsory social security, M. Education, N. Health and social work, O. Other community, social and personal service activities.

  3. 3.

    In the mid 1980s, Fontaine (1987) assessed the French demand structure for rather broad service categories empirically (quoted in Illeris, 1996, ch. 3). Another way to assess the demand orientation of an industry would be to use input-out-tables. To our knowledge, however, the demand structure has so far not been analyzed for services at the NACE three-digit level.

  4. 4.

    Combined output refers to the sum of intermediary and final demand, excluding sales to the public sector and exports.

  5. 5.

    In the work of Legler and Frietsch (2006), the procedure of classifying knowledge-intensity has only been accessible for us in an incomplete way. We could not retrieve a documentation of the criteria and values for classification.

  6. 6.

    For a detailed discussion and documentation of this methodology see Glückler et al. (2010).

  7. 7.

    Operational services are defined by a lower share of employees with a tertiary education. Conceptually, it is therefore difficult to qualify as technology-intensive as long as R&D intensity is the defining criterion. To our knowledge, no alternative research has been published on the technology-intensity of operational services. While operational services are subject to standardization and the use of technology, they are usually not found to be producers of technology. In some cases, however, services such as logistics and retailing have been found to develop new technologies internally. Hence, it would be possible to empirically find technology-intensive firms within these service sectors. It is certainly an area for future research to conceive alternative measures of technology-intensity.

  8. 8.

    Other examples are scheduled air transport or veterinary activities or wholesale that have changed correctly from operational consumer services (OCS) to knowledge-intensive business services (KIBS).

  9. 9.

    Our service typology is based on the three-digit level of sector classification; input–output tables were used to distinguish between consumer and business services. But the national account system does not break all branches down to the three digit-level. For some branches, demand orientation is only available at the two-digit level. Space transport for example relates to non-scheduled flights, data is only available for both services together (62.2-3). As the national account system joins non-scheduled flights and space transport (62.2-3) both are classified as consumer services, although space transport should be classified as a business-oriented service sector. Given the fact that the national account system does not provide data on a three-digit level for every service branch, we use two-digit data for the following ten sectoral groups to estimate value at the three-digit level: wholesale and commission trade, retail trade, financial intermediation, insurance and pension funding, activities auxiliary to financial intermediation, computer and related activities, public administration and defense, sewage and refuse disposal, activities of membership organization as well as other service activities (NACE-Code: 51, 52, 65, 66, 67, 72, 75, 90, 91 and 93). For the stated economic activities we assigned the ratio of demand orientation to the three-digit level.

  10. 10.

    The month of reference was 31 June for each year.

  11. 11.

    The Nomenclature of Territorial Units for Statistics, (NUTS) is a geocode standard for referencing the administrative divisions of countries for statistical purposes. The standard was developed by the European Union, and thus covers the member states of the EU in detail. NUTS level 3 corresponds with the administrative level of Kreise in Germany.

  12. 12.

    The BBR (Bundesministerium für Bauwesen und Raumordnung) is the German Federal Office for Building and Regional Planning.

  13. 13.

    Here, non-service jobs represent the residual sectors of agriculture, fishery and forestry, industrial manufacturing, mining and construction (NACE Rev. 1.1 groups A, B, C, D and F).

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  1. Institute of Geography, University of Heidelberg, Heidelberg, Germany

    Johannes Glückler & Ingmar Hammer

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  1. Johannes Glückler
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  1. , Applied Economics, University of Alcala - Madrid, Plaza Victoria 2, Alcalá de Henares, 28802, Spain

    Juan R. Cuadrado-Roura

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Glückler, J., Hammer, I. (2013). A New Service Typology: Geographical Diversity and Dynamics of the German Service Economy. In: Cuadrado-Roura, J. (eds) Service Industries and Regions. Advances in Spatial Science. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-35801-2_14

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  • DOI: https://doi.org/10.1007/978-3-642-35801-2_14

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