EScroogeJr (< 20)

US economy by industry

May 16, 2008 – Comments (2)

Found a good link that gives you the composition of the US economy by industry:

http://www.bea.gov/industry/xls/GDPbyInd_VA_NAICS_1998-2007.xls 

(second tab, "value added as a percentage of gross domestic product" part) 

To round off the numbers, agriculture produces 1%, mining and utilities contribute another 2% each, construction is 5% and manufacturing- 12%. Retail trade gives another 6%, and, surprisingly enough, wholesale trade also accounts for 6% (one would think that most of the added value must be be produced in the retail). Transportation and warehousing - 3%. Information - 4.5%. Finance, insurance, real estate, rental and leasing - this huge chunk accounts for 21% of the recorded economic activity. Another 12% is "Professional and business services". Educational services, health care and social assistance account for another 8%. The sector "Arts, entertainement, recreation, accomodation, and food services" adds another 3.5%. The rest is government spending and miscellaneous services.

Notice the ficticious character of large chunks of the economy. For example, "professional and business services" emerge as a more important sector than the old boring manufacturing, and, in particular, "managing of companies and enterprises" (1.8%) turns out to be more crucial than agriculture. Finance and insurance accounts for 8% - more than health care. Ot of that 8%, 4.3% is contributed by Federal reserve banks, credit intermediation and related activities (who would think this industry produces more value than mining and utilities combined?). "Real estate" is 12% of the GDP, but it is not construction, and not "rental and leasing services" (these services give their own 0.8% contribution). I assume most of it is homeowner imputations - a $1 trl fictitious activity that the BEA is trying to pass off as real. It appears that about 40% of the GDP is just fluff that can be removed from the system without anybody noticing.