US Information Sector
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 163,868 establishments in the US information sector produce, manage, and distribute information, including news, entertainment, cultural programming, and data. The sector includes industries that provide the infrastructure and systems to transmit and distribute content, data, and communications, as well as those that allow customers to search for, store, and process data.
Fads and Trends
Success in the media and publishing industries is largely dependent on consumer acceptance, which is subject to fads and trends.
Evolving Technology
The information sector relies on rapidly evolving technology that can fundamentally change the dynamics of individual industries.
Industry size & Structure
The information sector is comprised of 163,868 establishments that employ 3 million workers and generate $2.2 trillion in annual revenue, according to government sources.
- The information sector represents 5.4% of the nation's Gross Domestic Product (GDP) and employs 1.3% of the country's workers.
- The sector is concentrated at the top with the 20 largest firms representing 51% of revenue, but it is fragmented at the bottom.
- In addition to employer establishments, the information sector has 359,000 owner-operated establishments with no employees. Subsectors with the highest numbers of nonemployer establishments are motion picture and sound recording (38%); publishing (18%); and data processing, hosting, and related services (13%). The owners of nonemployer establishments typically perform the work and may outsource support functions like marketing and accounting.
- The information sector shed about 31,000 establishments in 2021, which equals about 11.4% of existing establishments, according to the Bureau of Labor Statistics. However, the sector added about 54,000 new establishments, which is equivalent to 19.8% of existing establishments. As a result, the sector had a growth rate of 8.4%.
- The information sector is forecast to grow its employment base by 7.4% overall in 2021-2031, which is higher than the national average of 5.3% for all jobs, according to the Bureau of Labor Statistics.
Industry Forecast
US Information Sector Industry Growth
Recent Developments
Nov 14, 2024 - AI Brings New Insurance Considerations
- Increasing use of artificial intelligence (AI) technologies, particularly generative AI, raises crucial questions regarding insurance for Information sector firms like software publishers, according to Jean-Guibert Ciavaldini at the law firm Simmons & Simmons. Legal, contractual, and insurance challenges associated with the use of AI in sectors like marketing, process automation, and text analysis and processing differ across passive and active use of AI. Passive AIs exclusively analyze data and provide recommendations, while active AIs can make autonomous decisions based on these analyses. An active AI can lead to higher risks in terms of liability, requiring more robust coverage in professional liability insurance (PLI) and cyber risk insurance.
- Commercial electricity demand from 2019 through 2023 grew fastest in states with rapid computing facility growth, according to the Energy Information Agency. Consumption of electricity in the US commercial sector has recovered from pandemic levels, with annual US sales of electricity to commercial customers in 2023 totaling 14 billion kilowatt hours (BkWh), or 1%, more than in 2019. The increase in commercial demand for electricity is concentrated in a handful of states experiencing rapid development of large-scale computing facilities like data centers. Electricity demand has increased the most in Virginia, which added 14 BkWh from 2019 through 2023, and Texas, which added 13 BkWh. Demand for electricity by the commercial sector in some large states such as New York, Illinois, and California has been flat or has decreased compared with 2019.
- Wireless-only is by far the dominant telecommunications service in US households, according to the US Census Bureau. About 47.7% of US adults lived in a wireless-only household and 43.7% in a household with both landline and wireless service in 2015. By 2022, the share of adults living in wireless-only households had jumped to 72.6% while the share in households with both landline and wireless had dipped to 25.4%. The share of adults living in landline-only households dropped from 5.8% in 2015 to 1.3% in 2022.
- Information industry sales are forecast to grow at a 4.23% compounded annual rate from 2024 to 2028, comparable to the growth of the overall economy, according to Inforum and the Interindustry Economic Research Fund, Inc. US information sector employment and average wages for nonsupervisory employees increased slightly during the first nine months of 2024, according to the US Bureau of Labor Statistics. Information sector revenue increased 5.71% year over year and 2.68% quarter over quarter during the first quarter of 2024, according to the US Census Bureau.
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