United States: Economic and Political Overview
The United States is the world's largest economy ahead of China. The country recovered well from the COVID-19-induced crisis, with GDP rebounding by 6.1% in 2021, followed by 2.5% in 2022 (IMF). According to estimates by the Bureau of Economic Analysis, in 2024, real GDP grew by 2.8% in 2024, slightly down from 2.9% in 2023. The 2024 growth was driven by higher consumer spending, investment, government spending, and exports, while imports also rose. More specifically, consumer spending rose due to gains in services and goods. Healthcare, particularly hospital and outpatient services, led service growth; whereas recreational goods and vehicles, driven by information processing equipment and motor vehicles, boosted goods spending. Government spending increased at both state and federal levels. State and local growth were driven by employee compensation, while federal growth was led by defence expenditures (data Bureau of Economic Analysis). According to the IMF, the rate of economic activity is anticipated to remain relatively stable in 2025, at 2.7%, slowing to 2.1% the following year.
Concerning public finances, in fiscal year 2024 (which ended on September 30), the federal budget deficit rose to USD 1.8 trillion, up USD 138 billion (8%) from 2023, equaling 6.4% of GDP (above the 50-year average of 3.8%). Revenues increased 11% (USD 479 billion), driven by higher individual income taxes, while outlays rose 10% (USD 617 billion), led by education (USD 309 billion). Interest payments on public debt grew 34% to USD 949 billion. Federal debt reached 97.8% of GDP, up from 96% in 2023 (data Congressional Budget Office). The CBO forecasted a USD 1.87 trillion federal budget deficit for fiscal year 2025, with a further decrease in 2026 (USD 1.71 trillion), hitting USD 2.7 trillion in 2035. As per the IMF, persistent high deficits and interest expenses have led to a rise in general government debt, which was estimated at 121% of GDP in 2024. Early 2025 data by the U.S. Bureau of Labor Statistics show that inflation increased 2.9% over the 12 months ending in December. The core index (excluding food and energy) rose 3.2%, while the energy index fell 0.5%. The food index grew by 2.5% over the same period. Easing inflation prompted the Fed to lower its federal funds rate by 0.25% to 4.25%-4.5% in January 2025, in order to balance employment and price stability. The IMF forecasts an inflation rate of 1.9% in 2025, followed by an average of 2.1% in the two following years.
Hiring has eased following significant U.S. central bank rate hikes in 2022 and 2023. However, the economy remained strong due to a resilient labor market, characterized by historically low layoffs and wage-driven consumer spending. The IMF estimated an unemployment rate of 4.1% at the end of 2024, with an expected increase to 4.4% this year. Overall, American citizens enjoy one of the highest GDPs (PPP) per capita in the world, estimated at more than USD 89,680 in 2025 by the IMF. Nevertheless, inequalities are still significant, as they tend to be worsened by current public health policies (with rising numbers of people without health insurance). In 2023, the poverty rate was 11.1%, with 36.8 million people in poverty, a level similar to the previous year (U.S. Census – latest data available).
| Main Indicators | 2023 (E) | 2024 (E) | 2025 (E) | 2026 (E) | 2027 (E) |
| GDP (billions USD) | 27,720.73 | 29,167.78 | 30,337.16 | 31,526.94 | 32,786.79 |
| GDP (Constant Prices, Annual % Change) | 2.9 | 2.8 | 2.7 | 2.1 | 2.1 |
| GDP per Capita (USD) | 82,715 | 86,601 | 89,678 | 92,786 | 96,070 |
| General Government Balance (in % of GDP) | -7.6 | -7.7 | -7.5 | -6.8 | -6.2 |
| General Government Gross Debt (in % of GDP) | 118.7 | 121.0 | 124.1 | 126.6 | 128.4 |
| Inflation Rate (%) | 4.1 | 3.0 | 1.9 | 2.1 | 2.1 |
| Unemployment Rate (% of the Labour Force) | 3.6 | 4.1 | 4.4 | 4.3 | 4.2 |
| Current Account (billions USD) | -905.38 | -948.64 | -933.91 | -880.36 | -829.18 |
| Current Account (in % of GDP) | -3.3 | -3.3 | -3.1 | -2.8 | -2.5 |
Source: IMF – World Economic Outlook Database, October 2021
The United States is a highly industrialised country with high levels of productivity and the use of modern technologies. Key sectors include agriculture (corn, soy, beef, and cotton); manufacturing of machinery, chemical products, food, and automobiles; and a booming tertiary market focused on finance, new technologies, insurance, real estate, rentals, and leases. The American agricultural sector is without doubt one of the world's largest, with California alone producing more than one-third of the country's vegetables and two-thirds of its fruits and nuts. Nevertheless, agriculture only accounts for 0.9% of GDP and employs 2% of the workforce (World Bank, latest data available). Based on data from the Bureau of Economic Analysis, agriculture, food, and related industries contributed approximately USD 1.537 trillion to U.S. GDP in 2023, accounting for 5.5%. The output from American farms made up USD 222.3 billion of this total, representing around 0.8% of GDP. The USDA’s December 2024 forecast projected net farm income at USD 140.7 billion—a 4.1% drop from 2023 and a 22.6% decline from the 2022 peak. Inflation-adjusted losses deepen by 6.3%. In 2024, U.S. corn production was estimated at 14.9 billion bushels, down 3% from 2023. Rice rose 2% to 222 million cwt, soybeans increased 5% to 4.37 billion bushels, and cotton surged 19% to 14.4 million 480-pound bales (data USDA).
Including a broad range of activities, the industrial sector contributes to 17.6% of GDP and employs 19% of the workforce (World Bank). Besides the industries mentioned above, the country is also the world leader in the aerospace and pharmaceutical industries. Thanks to its abundant natural resources, the United States has become a leader in the production of several minerals and has been able to maintain diversified production. The country is the world's largest producer of liquified natural gas, aluminium, electricity and nuclear energy. It is the world's third-largest oil producer and has also developed shale gas extraction on a large scale. In terms of value-added, the U.S. is the second-largest manufacturing nation in the world behind China. The manufacturing sector alone contributes USD 2.65 trillion to the economy, employs nearly 13 million workers, and represents 10.3% of GDP (U.S. Department of Commerce).
The American economy is essentially based on services: the tertiary sector accounts for more than three-fourths of GDP (76.4%) and employs 79% of the country's workforce (World Bank). The United States hosts the world's largest and most liquid financial markets. In 2023, the finance and insurance sector accounted for 7.3% of GDP (U.S. Trade Dept.). At the end of the same period, the U.S. banking system had USD 23.7 trillion in assets and a quarterly net income of USD 38.4 billion. The latest figures from the Bureau of Economic Analysis show that U.S. private services-producing industries’ value-added increased by 4% quarter-on-quarter in Q3/2024, the leading contributors to the increase being retail trade (led by motor vehicles and parts dealers); health care and social assistance (led by ambulatory health care services); and information (led by data processing, internet publishing, and other information services). According to the World Travel & Tourism Council (WTTC), the U.S. is the world's leading travel & tourism market, with a record USD 2.36 trillion contribution to the economy in 2023.
| Breakdown of Economic Activity By Sector | Agriculture | Industry | Services |
| Employment By Sector (in % of Total Employment) | 1.6 | 19.3 | 79.1 |
| Value Added (in % of GDP) | 0.9 | 17.6 | 76.4 |
Source: World Bank, Latest Available Data. Because of rounding, the sum of the percentages may be smaller/greater than 100%.
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The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.}}
Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation
The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure.
Source: The Economist Intelligence Unit - Business Environment Rankings 2021-2025
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