The economy of the United States is a highly developed market economy. It is the world’s largest economy by nominal GDP and net wealth, and the second largest by purchasing power parity (PPP), one step behind China.
The country hosts the most developed, liquid, flexible, and efficient financial markets in the world, and benefits from a wide range of funding sources – from banks and investment firms to venture capitalists and angel investors – that enable innovation and expansion.
The U.S. economy offers the largest consumer market on earth with a GDP of $20 trillion and 334 million people. Household spending is the highest in the world, and accounts for nearly a third of global household consumption.
The nation’s labor market attracts immigrants from all over the world, with its net migration rate being among the highest in the world.
The U.S. is also the most technologically powerful and innovative economy in the world, with its firms being at or near the forefront of technological advances – especially in artificial intelligence, computers, pharmaceuticals, and certain types of equipment (medical, aerospace, and military).
The U.S.’ strongest sectors include real estate, services, manufacturing, and retail, and is a recognized leader is research and development, registering more international patents than any other country.
Another strength of the U.S. economy also includes its dollar is the most popular currency for international transactions and is the world’s foremost reserve currency. Several countries use the US dollar as their official or de facto currency.
The United States is also the world’s largest importer and second largest exporter and has free-trade agreements with over 20 countries, including Mexico, Canada, Australia, and South Korea.
Geographically, the United States is home to vast and varied landscapes with abundant natural resources. Its diverse regions connected by an expansive infrastructure network and services that help companies efficiently produce and move their products. The USA also has strong international ties – it is a founding member of the United Nations, World Bank, International Monetary Fund, NATO, the Organization of American states, and other international organizations.
Small and Medium-Sized Businesses (SMEs) in the US play a significant role in the country’s economy and are vital to its economic development and job creation.
Small businesses are defined as “firms with fewer than 500 employees”, according to the US Small Business Administration.
In 2021, the number of small businesses reached 32.5 million, which make up nearly all U.S businesses (99.9%). Out of this total, over 5 million of them recorded having less than 20 employees.
US SMES generate about 44% of economic activity and the employment of 61.2 million people, which accounts for 46.8% of the country’s employees.
However, the popularity of small businesses does depend on the state – California holds the top spot with 4.2 million small businesses, and employing 48.2% of the state’s employees, which is higher than the national average.
Other hotspots for small businesses include:
Texas: 3 million
Florida: 2.8 million
New York: 2.3 million
Illinois: 1.2 million
The United States of America
Central Standard Time (GMT-6), Mountain Standard Time (GMT-7)
Pacific Standard Time (GMT-8), Alaska Standard Time (GMT-9)
Hawaii-Aleutian Standard Time (GMT-10)
January 1st – December 31st
No VAT, but has a ‘Sales & Use Tax’, which varies according to the state and special jurisdictions, with the option to add another tax on top of this.
National Minimum Wage:
$7.25 per hour
Taxpayer Identification Numbers:
Social Security Number (SSN)
Individual Taxpayer Identification Number (ITIN)
Employer Identification Number (EIN)
Preparer Taxpayer Identification Number (PTIN)
Main trading partners:
Canada, Mexico, China, Japan, United Kingdom, Germany.