Government Sector

Government Sector

Brief Excerpt from Industry Overview Chapter:

Agencies in this sector administer government services at the federal, state, or municipal level. The largest US government agencies by employment include the federal Department of Agriculture, Department of Defense, Department of Homeland Security, Department of Justice, and Department of Veterans Affairs.


Demand for government services is driven by population growth and changing demographics of the US population. The US Census Bureau estimates that the 65-and-over population will climb by 60% between 2016 and 2035, which will increase the demand for federal programs like Social Security and Medicare. State and local governments experience similar demand drivers, but face increasing or decreasing revenues from which to fund services based on shifts in the population, as well as changes in economic conditions.


Major government services include federal, state, and municipal spending. Federal spending includes the Department of Defense which accounts for 15%; Department of Health and Human Services which accounts for 27%; Department of the Treasury which accounts for 16%; and Social Security which accounts for 25%. State spending includes Education which accounts for 34%; Public welfare which accounts for 35%; and Hospital and Health account for 8%. Municipal spending includes Taxes which account for 69% of the general revenues; Sales and gross receipt taxes (selective) which account for 35% of the tax revenues; Individual and corporate income taxes which account for 26% of the tax revenues; Intergovernmental revenue which accounts for 29% of the...

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