Millions of Americans have lost their homes, tens of millions of Americans can’t find a decent job and 44 million Americans are on food stamps [1]. Economy is related to everyone in the world. A poor economy can affect how people eat, shop and live their day to day life. I am sure each person goes to stores for shopping. Let’s say you went to buy a pair of Nike shoes. You went into the store and found the shoes you want were all sold out! Then, you thought you would wait for a while, until the price of shoes you want goes down. However, next time you go to the store, you found out the price has actually gone up! You have just been affected by the supply of a product. As more people want something, the price will be higher. The level of income also depends on the overall status of the economy. For example, if we have a recession, then the income for most of us will be less. Some people might be unemployed. If we have growth, income will increase and the unemployed rate will decrease. This is why economy becomes one of the most popular topics in the world. The world economy is interconnected on many levels. Economy of China and the United State is quite different in service industries, import and export trade.
As the economy is developing fast and the significant change on economic structure is progressing, the importance of service industry in economic system is increasing and becoming a key to economic growth nowadays. Think about the services we rely on: doctors, bankers, accountants, nurses, restaurant workers and so on. And there are many more service workers who touch our lives every day. In the United States, seventy eight percent of the GDP is attributed by service industry [2]. In China, forty three percent of the GDP is attributed by service industry [3]. Even though the service industry in China is not as big as the service industry in the United States, it has already grown a lot and increased living standards by raising the productivity of industrial enterprises.
Information is a valuable resource for the development of society and economy. Information service belongs to the service industry. It is defined as: Agency or department responsible for providing processed or published information on specific topics to an organization's internal users, its customers, or the general public.
In the United States, there is not a specific industrial classification of Information Services. However, 'Information' section is very important in NAICS (North American Industry Classification System, U.S. Census Bureau). Most Information Services are at the intersection of information industry and service industry like newspapers, books, directory publishers and related service. From the Information Services statistics of the United States, in 2002, there were 73000 establishments and 330 billion dollars revenue. The annual payroll was more than 80 billion dollars and 1.8 million paid to employees [5]. There were 94720 Information Technology companies in the United States, and the majority of global top ten Information Technology companies were in the United States, such as IBM, Microsoft and Cisco. The powerful Information Technology provides positive feedback and improves the development of Information Services in the United States.
In 1992, CIITA (China Information Industry Trade Association) did a wide survey among establishments that provide Information Service. Before that, there were no consensus about classification of information Services. In 2002, Chinese government conducted the second basic establishments’ survey and that was the first time that the Chinese government adopted an official classification about Information Services. China’s Information Services lacking of strong demand for information resulted in the Information Services provider laying more emphasis on simple process [5]. The development of Information Services in China is uneven. In some big cities such as Beijing, Shanghai and Guangzhou, there are more information resources. They have better Information Services than the central and western inland regions.
Comparing the Information Services between the United States and China, there are four significant differences. First, Information Technology has been used more in American Information Services. China’s information service is at the simple processing stage. Secondly, the United States have high expenses of human resources and office space in the development of information services. But the cost of staffing in China is only ten percent of that in the United States. China also had relatively low cost in real estate and power supplies. Thirdly, the United States had a large number of information services institutions around the country. But China’s information services institutions are unevenly developed. Finally, information services are well-defined industry in the United States, but it doesn’t have a specific industrial classification of information service in China. Chinese government has paid more attention to information services now.
Trade is very common which is very important for economic growth. People knew about trade long time ago. The Silk Road was one of the first trade routes to bridge the Eastern and the Western worlds. There are a lot of advantages of international trade. International trade allows consumers to have variety of goods and help improve the quality of goods. According to USTR, “U.S. goods and services trade with China totaled 390 billion dollars in 2009. Exports totaled 85 billion dollar; imports totaled 305 billion dollar. The U.S. goods and services trade deficit with China was 219 billion dollar in 2009” [7]. China was the United States’ third largest goods export market and largest supplier of goods imports in 2010. Top export categories from United States to China include Electrical Machinery, Machinery, Miscellaneous Grain, Seed, Fruit, Aircraft, and Optic and Medical Instruments [7]. The five largest import categories that U.S. imports from China in 2010 were: Electrical Machinery, Machinery, Toys and Sports Equipment, Furniture and Bedding, and Footwear [7].
There is a lot of benefit of import and export between China and other countries. It has made the industry in China grow fast because of the imports of knowledge services, network services and financial services form developed economies. It also resulted in higher average labor productivity of 0.3 percent, and the production led 6.5 million dollar increase of GDP in China with the United States. Higher productivity means higher standards of living for Chinese citizens, and it also helps the employment in China. In the United States, the services sector exports to China are growing fast. The United States is world’s largest exporter of services. The service companies in the United States provide high-skill services to customers and markets throughout China, in knowledge, network and financial service industries. China’s services market could also boost U.S. GDP by up to 0.2 percent.
Economies of China and the United State are different between service industries, import and export trade, but they are also interconnected on many levels. Since economy has huge influence in people's life, it is important to explore new ways to promote the economy and provide higher standards of living for people in the world.
Work Cited:http://endoftheamericandream.com/archives/why-is-the-economy-so-bad[1]
