Szektorfügg

Szektorfügg is a term used in economics and urban planning to describe a situation where a particular geographic sector or area becomes overly reliant on a single industry or type of economic activity. This dependency can make the sector vulnerable to fluctuations in that specific industry. For example, a town whose economy is heavily based on manufacturing a single product might face significant challenges if demand for that product declines or if production moves elsewhere.

The consequences of szektorfügg can include high unemployment rates, a decline in local businesses that support the dominant industry, and a general decrease in the economic vitality of the region. This can also lead to a lack of diversification in the local workforce, making it difficult for individuals to find alternative employment if their primary industry falters. The term highlights the risks associated with a narrow economic base and underscores the importance of economic diversification for long-term stability and resilience. Strategies to combat szektorfügg often involve promoting the growth of new industries, investing in education and training for a broader range of skills, and attracting diverse businesses to the area.