Question

Discuss the specifics of the U.S. economy (for example, is it driven by oil/commodities, service sector, industrial production etc.)

Answer 1

The specifics of US economy are discussed below:-

SERVICES: are now the vast majority of the US economy and they're going to become an ever larger portion of it in the future. The service sector has been both the largest and the fastest growing component of the U.S. economy. Fifty years ago, the service sector accounted for about sixty percent of U.S. output and employment. Today, the service sector's share of the U.S. economy has risen to roughly 80 percent. Construction, the smallest subsector, now accounts for a higher share of economic output than either agriculture or mining (construction is counted among the subsectors here because it is viewed as a service in the context of international trade). Aside from sheer size, the most crucial aspect of the service sector's ascendance is the thorough integration of services with virtually every other aspect of the present-day American economy. From Main Street to Wall Street, wherever business is conducted in the United States, services businesses are an essential component of the local economy -- a critical source of new local jobs, an essential ingredient in creating a commercial environment conducive to entrepreneurship, and a vital link to the wider U.S. and world economies. The relative importance of small services providers is most apparent when contrasted with the U.S. manufacturing sector. There, the 242 thousand firms with fewer than twenty employees accounted for three out of every four manufacturing firms, but for only one of every fourteen manufacturing jobs -- for a nationwide total of about 1.3 million jobs, or, on average, about 27 thousand jobs in each of the fifty states. While the importance of small services firms can hardly be overstated, it is no more than a part of the story of the modern services economy.

OIL/COMMODITIES: The extraction of oil and natural gas from shale has reduced the amount of oil the United States needs to import and is adding to the economy in the forms of jobs, investment, and growth. Oil exploration and production is again an important industry in the United States. The United States is once again one of the top producers of oil and gas. Greater domestic oil production is a net positive for the United States. However, as an oil-producing country (and not just an oil consumer), the United States now also feels an unpleasant pinch when oil prices drop. The price of oil influences the costs of other production and manufacturing across the United States. For example, A drop in fuel prices means lower transport costs and cheaper airline tickets. As many industrial chemicals are refined from oil, lower oil prices benefit the manufacturing sector. Before the resurgence in U.S. oil production, drops in the price of oil were largely viewed as positive because it lowered the price of importing oil and reduced costs for the manufacturing and transport sectors. This reduction of costs could be passed on to the consumer. Greater discretionary income for consumer spending can further stimulate the economy. However now that the United States has increased oil production, low oil prices can hurt U.S. oil companies and affect domestic oil industry workers.