Image Source: The US economy is complex, and comprised of many different industries that power the world’s largest GDP.Breaking it down is Visual Capitalist‘s Govind Bhutada, who used data from the Bureau of Economic Analysis to visualize a breakdown of US GDP by industry in 2023. He showed this by measuring dollar value added by industry, which reflects the difference between gross output and the cost of intermediate inputs.
The Top 10 U.S. Industries by GDPAs of Q1 2023, the annualized GDP of the U.S. sits at $26.5 trillion.Of this, 88% or $23.5 trillion comes from private industries. The remaining $3 trillion is government spending at the federal, state, and local levels.Here’s a look at the largest private industries by economic contribution in the United States:Like most other developed nations, the U.S. economy is largely based on services.Service-based industries, including professional and business services, real estate, finance, and health care, make up the bulk (70%) of U.S. GDP. In comparison, goods-producing industries like agriculture, manufacturing, mining, and construction play a smaller role.Professional and business services is the largest industry with $3.5 trillion in value added. It comprises establishments providing legal, consulting, design, administration, and other services. This is followed by real estate at $3.3 trillion, which has consistently been an integral part of the economy.Due to outsourcing and other factors, the manufacturing industry’s has been declining for decades, but it still remains a significant part of the economy. Manufacturing of durable goods (metals, machines, computers) accounts for $1.6 trillion in value added, alongside nondurable goods (food, petroleum, chemicals) at $1.3 trillion.The Government’s Contribution to GDPJust like private industries, the government’s value added to GDP consists of compensation of employees, taxes collected (less subsidies), and gross operating surplus.State and local government spending, largely focused on the education and public welfare sectors, accounts for the bulk of value added. The Federal contribution to GDP amounts to roughly $948 billion, with 52% of it attributed to .
The Fastest Growing Industries (2022–2032P)In the next 10 years, services-producing industries are projected to see the fastest growth in output.The table below shows the five fastest-growing industries in the U.S. from 2022–2032 in terms of total output, based on data from the :Three of the fastest-growing industries are in the information sector, underscoring the growing role of technology and digital infrastructure. Meanwhile, the projected growth of the oil and gas extraction industry highlights the enduring demand for , despite the energy transition.Overall, the development of these industries suggests that the U.S. will continue its shift toward a services-oriented economy. But today, it’s also worth noticing how services- and goods-producing industries are increasingly tied together. For example, it’s now common for tech companies to produce devices, and for manufacturers to use software in their operations.Therefore, the oncoming tide of growth in service-based industries could potentially lift other interconnected sectors of the diverse U.S. economy.More By This Author:WTI Extends Losses To 5-Month Lows After API Reports Huge Crude Build At CushingNvidia Insiders File Paperwork To Dump 370,000 Shares Futures Drop As Torrid November Rally Fizzles Ahead Of Jobs Data Deluge; China Stocks Hit Five Year Low
Visualizing US GDP By Industry In 2023
