Some people propose that we can keep our economy growing, without encountering the limit of resource availability by choosing to perform only economic activities that don't use resources.

Performing only economic activities that don't use resources means that an economy must be based on the supply of services rather than on the supply of goods. Services can be performed for a fee as an economic activity, without the direct use of resources. An economy that operates this way is called a service economy.

However, goods and services, which seem to be two completely different and utterly separate things, cannot be completely separated, and, in fact, they are closely intertwined. Services cannot be provided without the existence of goods, and goods are the result of services that have been performed on the resources provided by the Earth. All of our economic activity, whether the final product to be consumed is a good that directly incorporates those resources, or a service that uses those resources indirectly, is ultimately underpinned by the resources provided by the Earth and its environments.

All economic activity, including providing services, is always part of a complete economic process, a process that starts with the collection of resources from the Earth, passes through production and distribution of products, and ends with consumption of those products. For an economic system to function, all of the component economic activities of the economic process must be performed, because the economic process must be completed from beginning to end before it can produce the products that pay for it. The main stages of the economic process look like this:

Within that entire economic process some economic communities (groups of countries, individual countries, regions, cities) may choose to be a service economy, by only performing the service components of the economic process (designing, administering, transporting, selling, repairing, cleaning), leaving other economic communities to perform the other components of the economic process (collecting resources, processing resources, manufacturing products from the resources.)

Even if an economic community chooses to only perform services, the other economic activities that comprise the economic process must still be performed somewhere. They must be performed in other economic communities so that the economic process can be completed from beginning to end, creating the need for services. The division of economic activities may look like this:

While an individual economic community may choose to have only a service economy, overall, no fewer resources will be used by the entire economic process in which it takes part. The other activities of the economic process must still be done in other economic communities. These are usually the activities that involve dangerous work, waste disposal, environmental damage such as resource depletion, habitat destruction, pollution including greenhouse gas production, and many other negative aspects of the entire economic process.

The idea that having a service economy will reduce the use of resources is utterly false. Having a service economy doesn't achieve anything for an economic community towards reducing its use of resources, including the use of energy; or the production of pollutants, including the production of carbon-dioxide; or the loss of the biosphere through increased land use and habitat destruction; it just hides these resource use issues somewhere else, away from the service economy's citizens.

A service economy may also be known as a post-industrial economy. This term is used to imply that economic communities evolve somehow to an advanced state, and that all economic communities will eventually reach this advanced state. However, this is not so, because many (most) economic communities will be required to continue to perform resource-using non-service economic activities so that the economic process can be completed in order that services are required. The economic communities that reach a post-industrial economy first stand the best chance of being able to maintain that status.

For a society to have a services economy it must ultimately repress the societies that are providing the non-services parts of the economic process, to ensure that they cannot provide their own services and perform the entire economic process themselves. While not just any society can provide resources (you either have them or you don't), any society can provide its own services if it has a sufficiently educated and organised populace. For its own economic security, a society that relies of having a service economy must ensure that the societies that perform the non-services part of the complete economic process are kept poor, uneducated, insecure, and compliant; so that they can't develop and supply their own services, and perform the entire economic process themselves. 

This page is linked from:

how resources are used in the economic process 

decoupling the economy from resource use

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