ITC: U.S. is world’s largest services exporter

   The United States was the world’s largest services market and the world’s top exporter and importer of services in 2011, the U.S. International Trade Commission said in its Recent Trends in U.S. Services Trade, 2013 Annual Report.
   ITC, an independent fact-finding federal agency, compiles the report annually. Each year’s report presents a qualitative and quantitative overview of U.S. trade in services and highlights some of the service sectors and geographic markets that contribute substantially to the recent trade performance of those services.
   This year’s report focuses on professional services and includes separate chapters on the education, healthcare, and legal services sectors. Each chapter analyzes global market conditions in the sector, examines recent trade performance, and summarizes the sector’s outlook.
   The 2013 report covers cross-border trade in services through 2011 and affiliate sales through 2010 (latest available data). Highlights of the report include:

• From 2010 to 2011, U.S. cross-border services exports increased by 9 percent (to $587 billion), while U.S. services imports grew by 7 percent (to $393 billion). This represents the second consecutive year of strong trade growth following the financial crisis, according to ITC. Professional services accounted for 21 percent of total U.S. cross-border services exports and 19 percent of cross-border imports in 2011. 
• Services supplied abroad by foreign affiliates of U.S. firms continued to exceed services purchased from U.S. affiliates of foreign firms, reaching $1.1 trillion and $696 billion, respectively, in 2010. ITC said “professional services accounted for a relatively small but growing share of both sales and purchases of services through affiliates.” Architectural and engineering services accounted for the largest share of professional services supplied by U.S. foreign affiliates, while advertising services led purchases from U.S. affiliates of foreign firms in 2010. 
• The contribution of U.S. professional services to U.S. GDP in 2011 was $2.2 trillion, equal to 24 percent of the value added by all services and 19 percent of total private sector GDP. In 2011, the value-added professional services category exceeded all other major services categories including distribution, financial and electronic services. 
• Professional services employed 26 million full-time employees in 2011, equal to 26 percent of the total U.S. private sector workforce. 
• Professional services are subject to a variety of both entry and operational trade barriers. “In many cases, these barriers take the form of domestic regulations and are byproducts of a country’s domestic policy objectives such as protecting and developing its indigenous workforce. Such restrictions include economic needs tests and quotas on foreign providers. Other significant barriers include limits on setting up foreign affiliates and requirements that managerial staff be either citizens or permanent residents,” ITC said. 

   The report can be viewed on line here.