Lesson 5 1


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Business in the U.S. Economy
(Intro to Business, 6e)

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Lesson 5 1

  1. 1. Introduction to Business Lesson 5-1 Business in the U.S. Economy
  2. 2. The Changing U.S. Job Market <ul><li>End of 20 th century saw many new career prospects in dot.com world. </li></ul><ul><li>From 1992 to 2002 – employment grew nearly 17%. </li></ul><ul><li>In 2002, 144 million people held jobs. </li></ul><ul><li>By 2012, employment will reach 165 million, a 15% increase </li></ul><ul><li>By 2010, average age of worker will be over 40 years. </li></ul>
  3. 3. <ul><li>Workers in age group 16-24 will grow faster than overall labor force for first time in 25 years. </li></ul><ul><li>Hispanics, Asians, and African-American workers will also experience growth in the job force. </li></ul><ul><li>More women are in the work force (48% by 2012 as compared to 35% in 1960s). </li></ul>
  4. 4. Pressures on Employees <ul><li>Downsizing by companies caused employees to learn new jobs and work extra hours </li></ul><ul><li>In survey, 7 out of 10 parents felt they were not able to spend enough time with children. </li></ul><ul><li>Children see parents </li></ul><ul><ul><li>Change jobs </li></ul></ul><ul><ul><li>Take on more responsibility, work longer hours </li></ul></ul><ul><ul><li>Complete additional education to improve career opportunities </li></ul></ul><ul><ul><li>Balance work and family </li></ul></ul>
  5. 5. <ul><li>Contingent Worker – one who has no explicit or implicit contract for long-term employment </li></ul><ul><li>Nearly 6 million (5%) of U.S. workforce is made up of contingent workers </li></ul><ul><li>Estimates project that number will double in ten years </li></ul>
  6. 6. Business and the Economy <ul><li>Most U.S. businesses are quite small. </li></ul><ul><ul><li>18 million businesses have no employees other than the owner </li></ul></ul><ul><ul><li>5 million companies employ less than 20 people </li></ul></ul><ul><ul><li>Just over 500,000 employ 20-100 people </li></ul></ul><ul><ul><li>About 103,000 large businesses employ 100 or more </li></ul></ul><ul><ul><ul><li>Of these large companies, 930 employ over 10,000 people </li></ul></ul></ul>
  7. 7. <ul><li>What are several groups that will increase as a percentage of the total U.S. workforce in the next decade (20 years)? </li></ul>Younger Workers (16-24 years of age) Asian, Hispanic, African-American groups Women
  8. 8. Roles of Business <ul><li>Provide employment </li></ul><ul><ul><li>Wages are used to purchase goods and services </li></ul></ul><ul><li>Profits earned by business are used to compensate owners and investors </li></ul><ul><li>Businesses pay taxes to federal, state, and local governments </li></ul><ul><li>Governments spend taxes to provide services </li></ul>
  9. 9. <ul><li>Most important role of business to make and distribute products and services needed by consumers, government, and other businesses. </li></ul>
  10. 10. Impact on a Community <ul><li>A New business </li></ul><ul><ul><li>pays wages to workers </li></ul></ul><ul><ul><ul><li>employees spend money to purchase things </li></ul></ul></ul><ul><ul><ul><li>employees will need housing, cars, food, entertainment </li></ul></ul></ul><ul><ul><ul><li>employees will pay taxes </li></ul></ul></ul><ul><ul><li>buys goods and services from other businesses </li></ul></ul><ul><ul><li>pays taxes </li></ul></ul><ul><ul><li>may attract other businesses to community </li></ul></ul>
  11. 11. Business Activities <ul><li>Generate Ideas </li></ul><ul><li>Raising Capital (money) </li></ul><ul><li>Employing and Training Personnel (Using human resources) </li></ul><ul><li>Buying Goods and Services </li></ul><ul><li>Marketing Goods and Services </li></ul><ul><li>Maintaining Business Records </li></ul>
  12. 12. Types of Businesses <ul><li>Producers </li></ul><ul><li>Intermediaries </li></ul><ul><li>Service Businesses </li></ul>
  13. 13. <ul><li>PRODUCERS – create the products and services used by individuals and other businesses </li></ul><ul><li>Extractors – takes resources from nature for direct consumption or for use in developing other products </li></ul><ul><li>Examples: miners, loggers </li></ul><ul><li>Farmers – cultivate land and use other natural resources to grow crops and livestock for consumption </li></ul><ul><li>Manufacturers – get supplies from other producers and convert them into products </li></ul>
  14. 14. <ul><li>Intermediaries (Marketers)– businesses involved in selling the goods and services of producers to consumers and other businesses. </li></ul><ul><li>Retailers – sell directly to consumers </li></ul><ul><li>Wholesalers – sell to retailers </li></ul>
  15. 15. <ul><li>Service Businesses – Carries out activities that are consumed by its customers. </li></ul><ul><li>It does not offer a product for sale. </li></ul>
  16. 16. THE END