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 Defense, Department of Homeland Security, Department of Justice, Department of Veterans Affairs, and Postal Service.


Demand for government services is driven by population growth and changing demographics of the US population. The Administration on Aging estimates that the 65-and-over population will climb to roughly 80 million by 2040, 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 over 10%; Department of Health and Human Services which accounts for about 25%; Department of the Treasury which accounts for about 20%; and Social Security which accounts for about 20%. State spending includes Education (about 25%) and Public welfare (about 30%); and Hospital and Health account for about 5%. Municipal spending includes Taxes which account for over 50% of the general revenues; Sales and gross receipt taxes (selective) which account for about 35% of the tax revenues; Individual and corporate income taxes account for about 20% of the tax revenues.

Industry Overview
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Industry Forecast
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