I just learned this today in my college econ class and thought I'd pass on the two cents. According to the US Department of labor 69% of sales in the US comes from services, not goods. Doesn't mean we're getting lazy, it just means people are specializing in the things they're good at according to my professor. Thought this would be helpful to anyone looking to start an online business.
This is the primary reason why Chinese goods are flooding ebay and ebooks sales are selling in the web like hot cakes.
Western economies are all becoming more service-orientated. As AUTOATTACKER implies, we can't compete with the Far East in manufacturing. But services are more difficult to out-source. Didn't Mark Twain once write a story about a mythical island where everyone made a living by taking in each other's washing?
Indeed, anyone that is learning the economical world as of late know where this trend is leading us... and that's becoming dependent on other countries to provide those good, as others have stated China, but India... and hell, pretty much any country really. It's has obvious pros/cons, but what's important is to balance the Products and Services... that is the recipe for a healthy, strong economy. Good post
Yes that the reality.Because US can't produce goods as competitive price compare to china goods. Thus they mainly depend on service sector
The US and most 1st world countries definitely can't produce goods as competitively priced compared to China, predominantly because the lifestyle (and living conditions) of those Chinese workers are not as expensive (aka extravagant or of as high a quality.) Having lost that income source, 1st world countries are left to either adapt their lifestyles to allow for cost competitiveness or to find other sources of income to support their existing lifestyle. At the same time, those Chinese workers should see some increase in lifestyle and an eventual global balance (realignment) should be struck. As far as services go, 1st world countries are taking a hit in that department as well. Not only in unskilled services like call centers, but also in more technical areas ranging from tech support to programming to sophisticated engineering (India is the perfect example of this.) It's really an interesting and far reaching topic of discussion! Globalization is coming into full swing and within our lifetime we will see many changes in the way we live our lives as things play out.
It costs too much for U.S. companies to produce goods. They end up with shabby profit margins because people don't pay enough for goods to offset the cost of producing them. So instead our kids are end up ingesting lead and the date rape drugs from toys created in China.