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Service Industries

By Edited Nov 13, 2013 0 0

When it comes to understanding service industries there are so many definitions out there that it is hard to pick one up and classify it as the best possible answer. Nonetheless, there is though one general definition of the service industries which is widely accepted by large segments of people and referred to as the most complete one. This definition incorporates every area of the economy, not taking into account the goods producing industries, which include mining, manufacturing, agriculture and construction. Using this definition, 1997 was a very good year which constituted about 2/3 of the gross domestic product of the United States.

If we are to have this definition woven out more narrowly and have areas like wholesale trade and retail, transportation, communication, real estate and finance and ultimately utilities, excluded, the sector of "pure" services will still be getting a lot of money rolling totaling an approximate percentage of 22 of the country's GDP, and considering that there are over 34 million employees, these services will still have been employed almost two times the number of workers as all of the United State's manufacturing. Thus, such patterns have been spotted regularly in other high industrial economies.

Thus these numbers are iconic when it comes to the high impact and importance the service industry has in the era of post industrial economy. But this is not a particularly new trend that has been going on for little time now. Of course, no one would be hypocrite enough to deny the fact that it was United States' main characteristic feature since early times, going as far as the World Word II. Thus, little time after the war has ended and things have finally began to get in place, these services have had a major importance and impact on the economy of the United States, representing a little below 50% of its GDP. As time continued to slip away, this percentage has continued to increase nonetheless, reaching to a total of 60% in the '80s.

Also when it comes to the employment transition, this particular situation has been a little more dramatic. The service industries sector has only been providing 5.4 million jobs in the 1950s, and you compare that with the 15.2 million in the manufacturing industry, you will see that there is a great difference between the two.

The service industry should be well managed for a country's GDP to be on the rise.


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