United States of America has one of the biggest, vibrant, and least understandable economy all over the world. Despite numerous successes and failures over the years, it has survived these fluctuations repeatedly largely because of its adaptability, creativity and capability to innovate. The essence of this article is an attempt to give a brief description of the American economy together with its historical background, the current situation, elements influencing its growth and potential obstacles.
Economic History of the United States of America
The United States of America economy is a history lengthy economy, it goes back to later 1700s. After the independence for the American economy was agricultural, and a major produce was tobacco, cotton, and wheat. However, from the pre-1800s, the US economy experienced industrialization, in particular; manufacturing, transportations and trade industries were established. This era was characterized by an increase of the American society from a more agriculture based society to an industrial one.
The United States became the biggest economic superpower of the twentieth century, thanks to two world wars, the great depression, and the Bretton Woods’ collapse. In this war global history saw the United States as the recipient of the role of the world’s leading economy and this role has not changed to date.
America is in a state of developing current circumstances of the US economy
The United States economy has describes as post- industrial, post-Fordist, and characterized by an information- economy or a new- service economy. As of 2021 nominal GDP for the United States is around over $21.4 trillion, thereby merely making the size of economy the largest globally. It is also the second biggest measured using the PPP being only behind China, and has a total GDP of roughly $21.0 trillion.
The service sector now occupies the largest part of the United States economy, where it gave around 80% of the gross domestic product and provides job opportunity to around 81.4% of workforce. The United States also ranks as the world’s third largest producer of goods including aircraft, automobile, computers and pharmaceuticals.
Growth Factors
The other included favorable business climate, highly professional human resource, availability of technology and many more. In addition, the government has also been supporting economic growth of the country by providing tax incentives, research grants and development, leveraging small scale businesses, etc.
Consumer spending also contribute to the economy of the United State by contributing about 70%of the GDP. The growing and healthy consumer’s market is meaningful for keeping stability of the economic growth and employment, company formation and investments.
The Left Side of the Challenges facing the U.S Economy
The United States is therefore also threatened by some threats that may slow down the development and the rate of economic growth further. Such risks are income disparity, large amount of debts, ageing population and lastly climate change. It also cannot get away from the fact of the world becoming one market where India and China rank as equal competitors.
The U.S economy is also open to another problem which is open vulnerability to other factors like calamities from nature, health, and conflicts in shaping the economy at the regional and international level and therefore may result in the oscillation of business activities and economic growth.
The challenges highlighted above in relation to the United States approach towards them will determine its economic destiny.
Conclusion
The United States has an adjusting, powerful economy, which has a propensity to attack and cut any challenges to its prosperity. The innovation, the workforce and the environment in which business can flourish are some of these factors. The United States however has faced several of these challenges and still has the potential and capacity to keep on growing and dominating economies of the world. Of most importance will be to always look out for important occurrences and make necessary adjustments considering the evolving global environment.
