New Commerce Department Report Shows Record Services Trade Surplus that Continues to Grow
U.S. services driving overall exports growth, topping half a trillion dollars
The U.S. Department of Commerce's Economics and Statistics Administration (ESA) today released a report showing U.S. trade in private services totaled $526.6 billion in 2010, representing a trade surplus that is growing, rising from $66.7 billion in 2003 to $168 billion in 2010.
The first in a series of ESA issue briefs, U.S. Trade in Private Services finds that U.S. services exports are leading the way toward doubling U.S. exports in support of several million new jobs under President Obama's National Export Initiative. The trade surplus has grown quickly since 2003, and the increase in exports of private services has outpaced the rise in imports. Exports of services have grown an average of 9.2 percent per year, while imports have grown an average of 7.4 percent. Exports of private services account for nearly one third of all U.S. exports of goods and services.
“The findings reported today are a remarkable statement about the strength of America’s trade in services,” U.S. Commerce Secretary Gary Locke said. “While much attention is given to the overall trade balance–and the Obama administration is committed to working to narrow the trade deficit – today’s report highlights an often overlooked but important and increasingly robust dimension of America’s role in global trade.”
The brief, based on data from the department’s Bureau of Economic Analysis, points to the financial and business services sector as contributing the most to the U.S. trade surplus, in addition to significant contributions from education services, fees for software and industrial process licenses, and other royalties. Travel represented the largest category of exports of services by the United States.
By country, the largest U.S. surpluses in services are with Canada, Japan, Ireland, Brazil, the United Kingdom, China and Mexico. The U.S. services surplus with China has accelerated rapidly since 2007, from $2.4 billion to $10.4 billion in 2010, because of sharp gains in exports and relatively flat imports, according to ESA data.
Exports support more than 10 million American jobs, and those whose jobs depend on trade earn 13 to 18 percent more than the national average. As a result of administration policies and the global economic rebound, exports grew 17 percent in 2010 compared to 2009 – the largest year-to-year percent change in more than 20 years.
Private services are defined as non-tangible items of value that are either consumed when purchased or at a later date by their terms of sale, such as school tuition or an airplane ticket. These are distinct from tangible items, or “goods,” such as oranges or motor vehicles.