Service Supersectors, Essay Example

Hoffman & Bateson (2010, p. 32) defines the nine supersectors of the service economy as: education and health services, financial, governmental, information, hospitality & leisure, business & professional, transportation & utilities, retail & wholesale trade, and other services. Today, these service economy supersectors account for over 75 percent of total employment, and this figure is likely to be growing in the next few years. The below essay will explain trends and industry specific characteristics of these supersectors.

According to the statistics of the U.S. Department of Labor (2013), while the manufacturing industries were losing jobs during the recession, they are likely to be growing. Still, the largest growing employment sectors predicted by the study will be the professional and business, and the hospitality & leisure sectors, surpassing the growth rate before the recession. In the public sector, however, the total number of jobs lost during the recession reached 700.000.

The latest report by the Labor Situation (2014) has revealed that over the past 12 months, government and other services shrunk, while educational and health services supersector grew.

It is important to review the government’s projections for the future of the different supersectors in order to understand how industries will grow, and their labor demand will change over time. The most recent report (U.S. Department of Labor, 2003) reveals some important trends in employment and sector growth. According to the statistical data, one of the major trends is “the long-term shift from goods-producing to service-providing employment”. The projections also include the statement that the health and education services will be the main driver of the service industry. By 2016, 30 percent of all new jobs created will be related to either education or health. Healthcare, due to the growing proportion of elderly population will also grow significantly. With longer life expectancy across the United States, demand for health care will expand fast. While the professional and business services supersector will grow slower, it will still grow by more than 20 percent between 2006 and 2016. The main driver of growth within this industry will be waste management and remediation, accounting for up to 40 percent of new jobs created in the supersector.

The main driver of the travel and hospitality supersector will be gambling and amusement services, while accommodation and food service will grow significantly slower. Trade, transportation, and utilities will only grow by 6 percent, with the main driver of growth being storage and warehousing.
Financial services sector growth (14.4%) will be driven by the increased demand for housing by the population. Real estate sales and letting will be the fastest growing subsector. Financial services, on the other hand will be also in demand due to the increased number of baby boomers who are looking for investment and retirement plans.

The slowest growth is projected to be in the government services sector. It will grow because of the increased demand of the public for safety, however, it will be limited by the constraints of the government budget. Another slowly growing sector is retail trade, with wholesale driving the growth. It is likely that people would move from shopping in smaller stores to hypermarkets even more.

One of the problematic subsectors determined by the report (U.S. Department of Labor, 2003) is utilities. With emerging technologies and high cost of innovation, it is predicted that by 2016 there would be a decline by more than 5 percent. This will be due to increased productivity, computerization, and innovative technologies.

Conclusion

Overall, it is important to note that understanding the social and economic drivers of growth and innovation in each supersectors will lead to a more accurate projection of demand and employment growth.

References

Hoffman, K. & Bateson, J. (2010) Services marketing: Concepts, strategies, & cases. Cengage Learning.

Labor Situation. (2014) April nonfarm jobs gain (2,200); unemployment rate drops to 6.9% Retrieved from http://www1.ctdol.state.ct.us/lmi/laborsit.pdf

U. S. Department of Labor (2003) Tomorrow’s jobs. Report. Retrieved from http://cis.hfcc.net/sites/default/files/us-labor1.pdf

U. S. Department of Labor (2013) Supersectors reveal positive signs for economy. The Official Blog of the U.S. Department of Labor. Retrieved from http://social.dol.gov/blog/supersectors-reveal-positive-signs-for-economy/