Information Services in the U.S. Economy: Value, Jobs, and Implications

It is well known that almost all of the largest economies in the world are already dominated by services. What may be less well known is that many are also evolving towards becoming information economies in the sense of both value added (GNP) and jobs. Of course, this evolution is less advanced in some countries, but the US is already well past the 60% mark in terms of economic value added. We further explore the confluence of these two trends, by examining the double dichotomy of products versus services and information versus material (non-information) outputs which divides the economy into four super-sectors. We do this by analyzing data on US GNP in 1992 and 1997 and the US job market (employment and wage rates by 821 occupational categories) in 1999. The main conclusions are that the US job market is also dominated by information work, that the largest part of the US economy in terms of GNP value added (in 1997) is the "information services" super-sector, that the largest job share in terms of the number of jobs is in the "material or non-information" jobs in services but the largest share of the wage bill (in 1999) is in information related jobs in services. Interestingly, the highest level of wages per worker is in information intensive tasks in product sectors. We discuss the reasons behind these trends, identify major differences between information and non-information sectors, and share our preliminary thoughts on the implications for management strategy in the information economy. [PUBLICATION ABSTRACT]