What Does the ‘Services Sector’ Mean in Marxian Terms?

Abstract

The services sector has grown as a share of GDP and employment in most countries in recent years, and there has been increasing interest in understanding this sector and in its growth potential. This article analyses the meaning and nature of the ‘services sector’ from a Marxian perspective. Marx did not analyse ‘services’ as such (although he did discuss certain types of activities that are currently classified as services), and ‘sectors’ are not the units of his economic analysis. From a Marxian approach, an activity needs to be analysed in terms of its location in the circuit of capital and its relationship with the production of surplus-value. The ‘services sector’ includes activities that are highly heterogeneous in these terms, including activities in which surplus-value is directly produced, activities that facilitate the production of surplus-value elsewhere (or increase the rate at which it is produced), and activities that stand outside of the circuit of capital. Marxian tools of analysis yield particular insights into the nature of various types of service activities, and these insights are helpful in understanding sectoral structure and the potential implications of changes therein.