Deindustrialization is the absolute long-term decline in manufacturing employment within an economy. It's not about a drop in productivity, rather a loss of jobs. Here are some factors leading to deindustrialization:

• Resource exhaustion
• Increasing raw material costs
• Automation and new technology introduction
• Rival product introduction
• Demand drop
• Competition from newly industrialized countries
• Rationalization
• Rising costs
• Subsidy removal
• Capital shortage

Since the 1950s, manufacturing employment has declined, especially in older industrialized countries. The service sector saw some gains, especially in banking, finance, and insurance, but these didn't compensate for the losses in manufacturing. A good chunk of the new jobs were filled by city outsiders.

Fun Fact: A common real-world example of deindustrialization is the textile industry in the UK. During the Industrial Revolution, the UK was known for its textile production. But over time, with cheap overseas labor and new technology, the industry declined and many textile factories were closed, leading to a loss of jobs.

There are two types of deindustrialization:

• Positive: Industries reduce their workforce to increase productivity through mechanization and rationalization, making the industry more competitive.
• Negative: Particular industries decline without any compensating rise in productivity or mechanization.

Reindustrialization is the growth of high-tech industries, small firms, and service industries (also known as tertiarization). This growth is often found more in less industrialized, rural, peripheral areas than in large urban areas with derelict sites.