Technology is indeed the epitome of growth and opportunity. Businesses continue to look for ways to integrate technology into their operations, supply chain, sales, and marketing departments. Most industries today are highly automated. You can take a look at some of the most automated industries in the United States.
With information technology, data management, and artificial intelligence combined, businesses often end up dominating the market if resources are used effectively. Speaking of which, according to a report by Fortune Business Insights, the global artificial intelligence industry was valued at $428 billion in 2022. The global artificial intelligence industry is expected to grow to $2.03 trillion by 2030 at a compound annual growth rate of 21.6%. The North American market dominates the industry, with a reported market size of $175.96 billion in 2022.
Similarly, the cloud computing industry is also experiencing rapid growth and development. According to a report by Fortune Business Insights, the global cloud computing industry had a market size of $569.31 billion in 2022. The global cloud computing industry is expected to grow to a valuation of $2.4 trillion by 2030 at a compound annual growth rate of 20%. The North American Market dominates the industry, with a market size of $401.49 billion in 2022.
The growth of the two industries indicates the potential the information technology sector holds for the future and explains why large companies like Amazon.com, Inc. (NASDAQ:AMZN) invested in offering cloud-based services years ago. On June 26, Amazon.com, Inc. (NASDAQ:AMZN) announced that the company set aside $7.8 billion to invest in the expansion of data centers in Ohio by 2030. Amazon.com, Inc. (NASDAQ:AMZN) has created 3,500 jobs in Ohio since 2015 and added $2.2 billion to the local gross domestic product in Ohio between the years 2015 to 2022.
Why is the Tech Industry Growing in the United States?
Technology demands funding and investment. Investing in the right human and natural resources is necessary to establish technologically advanced systems that are effective and efficient. The United States is at the forefront of innovation and technology primarily due to the continuous flow and investment funding from the government and large corporations.
On March 13, the Biden administration announced its annual budget set aside for Research and Development (R&D). According to the report, the Biden administration is set to invest $210 billion in federal R&D. Of this, slightly over $100 billion will be used for applied and basic research. Other than that, the government had also set aside $2.5 billion for innovative health research and $1.4 billion for the National Science Foundation (NSF) to upgrade STEM education and train the workforce in these industries.
While government funding is necessary, support from banks and large corporations is the need of the hour. On August 24, Reuters reported that HSBC Holdings Plc (NYSE:HSBC) is set to expand its venture debt offering to early-stage startups. This project is to be done under the supervision of the US innovation banking division of HSBC Holdings Plc (NYSE:HSBC). David Sabow, head of technology and healthcare at the bank's US innovation banking unit, stated:
"We've been working to mobilize the broader HSBC innovation banking platform around to support companies from Series A, all the way through their journey. We're helping with the operating business, the international expansion, the financing needs, and even leveraging the broader parts of the HSBC ecosystem to connect corporates with their early-stage potential targets."
These figures explain why new startups continue to bloom in the United States. On August 15, Forbes listed some of the next billion-dollar startups that are likely to succeed. These venture-backed startups are making considerable leaps by integrating technology into their systems. One such startup is Hex Technologies. Barry McCardel, the young CEO of Hex Technologies, has raised $96 million in equity ever since its inception. The startup boasted an estimated revenue of $6 million in 2022. The company collects data about consumer behavior and then converts them into charts and graphs for further data analysis. The startup operates on a freemium business model. What differentiates this business from other companies is that the company targets a specific niche. The niche consists of people affluent in analytics but need more exposure to the complete data science skillset.
Notable Names in the Tech Sector
Some of the top companies leading the tech sector include Alphabet Inc. (NASDAQ:GOOG), Microsoft Corporation (NASDAQ:MSFT), and Meta Platforms, Inc. (NASDAQ:META).
Alphabet Inc. (NASDAQ:GOOG) is one of the leading companies specializing in developing new technologies and investing in research and development. On September 14, Reuters reported that the company is set to launch its new artificial intelligence software, Gemini. The conversational AI software is more than just a regular chatbot. The software will enable people to draft emails, music, lyrics, or news stories. The software is also set to be a coder's best buddy. Companies already using the Google Cloud Vertex AI service can access Gemini.
Like Alphabet Inc. (NASDAQ:GOOG), Microsoft Corporation (NASDAQ:MSFT) dominates the tech industry. On September 18, the company reported the launch of the M365 Copilot Early Access Program in Australia. The new program allows Australian companies to test the new generative AI powerhouse. The program allows companies to streamline all their operations. Copilot is installed in all the products Microsoft Corporation (NASDAQ:MSFT) offers, allowing users to easily connect with the AI and use it as their assistant. To discuss the expansion of the program, Lucy Debono, Modern Work Business Group Director, Microsoft Australia and New Zealand, stated:
"Business leaders within the Early Access Program see this as an opportunity to gain a first-mover advantage in their sectors and enable greater productivity in a market navigating sustained economic pressure. We want these early adopters to work closely with Microsoft to use this technology, test it within their teams, help us to improve it further, and drive great employee experiences. This is such an exciting opportunity to see how Australian companies will use this incredible new tool to fundamentally change how we work."
Meta Platforms, Inc. (NASDAQ:META) is another top leader in the tech space. On August 22, the company introduced SeamlessM4T, a multimodal AI model for speech and text translations. The model detects almost 100 languages and offers speech-to-text translation, speech-to-speech translation, text-to-text translation, and text-to-speech translation.
Investment in technology and artificial intelligence is important for businesses to sustain themselves. After all, companies realize that AI is not here to take over but to assist. It is, without a doubt, true that technology and IT have been experiencing rapid growth in the United States, but many other industries and sectors are experiencing rapid output growth and employment as well. With that, let's look at the fastest-growing sectors and investment opportunities in the United States.
12 Fastest Growing Sectors and Investment Opportunities in the US
Our Methodology
To come up with the fastest-growing sectors in the United States we consulted the Bureau of Labor Statistics (BLS). We sourced our data from the Industry Output and Growth Projections database by the Bureau of Labor Statistics (BLS). We maintained NAICS conventions for sector classifications. We narrowed down the 12 fastest growing sectors in the US based on their output compound annual growth rate projections for 2022-2032, as calculated by the BLS. The BLS defines this metric as increases and decreases in the output of a sector over time, expressed as a constant rate of change. We have elaborated on the various industries that fall under every sector in order to give our readers an accurate representation of what industries and sectors are expected to grow the fastest over the coming years. The list is ranked in ascending order of the aforementioned metric.
12 Fastest Growing Sectors and Investment Opportunities in the US
12. Ambulatory Health Care Services
Compound Annual Growth Rate in Industry Output (2022-2032): 3.1%
Ambulatory health care services consist of healthcare services provided to a patient without admission to a facility or hospital. Primary industries in this sector include the offices of physicians industry, the offices of dentists industry, the offices of other health practitioners industry, the outpatient care centers industry, and the medical and diagnostic laboratories industry.
According to our methodology, the ambulatory health care services sector is among the fastest-growing sectors and will continue to experience a high growth in output for the forecast year 2032. The output of the sector in 2022 was recorded at almost $1.1 trillion followed by a forecast of almost $1.5 trillion in 2032. The sector is also expected to experience a 1.2% increase in employment in the forecast years of 2022-2032.
Some of the fastest growing industries are led by Alphabet Inc. (NASDAQ:GOOG), Microsoft Corporation (NASDAQ:MSFT), and Meta Platforms, Inc. (NASDAQ:META).
11. Offices of Physicians
Compound Annual Growth Rate in Industry Output (2022-2032): 3.2%
The offices of physicians sectors consist of health practitioners with a degree of M.D (Doctor of Medicine) or D.O (Doctor of Osteopathy). These practitioners either perform general medicine or specialized medicine independently. Some of the primary industries within this sector include the general medicine industry, the specialties medicine industry, the allied and mental health industry, and the biotech industry.
The offices of physicians sector is among the fastest growing sectors in the United States. The sector had an output of almost $558 billion in 2022 and is expected to grow to $767 billion in 2032.
10. Computer Systems Design
Compound Annual Growth Rate in Industry Output (2022-2032): 3.2%
The computer systems design sector specializes in the provision of expertise in several fields of IT including, designing, developing, and testing software, planning and designing computer systems, and professional computer-related services. The primary industries within this sector include the computer programming industry, the computer-related services industry, the computer systems design industry, the IT consulting and services industry, and the computer design manufacturing industry.
The computer systems design sector ranks among the fastest growing sectors in the United States. In 2022, the sector reported an output of almost $612 billion and is expected to grow to $841 billion in 2032. The sector is also expected to experience a 1.8% increase in employment in the forecast years of 2022-2032.
9. Management, Scientific, and Technical Consulting Services
Compound Annual Growth Rate in Industry Output (2022-2032): 3.3%
According to our methodology, the management, scientific, and technical consulting services sector is among the fastest-growing sectors and will continue to experience a high growth in output for the forecast year 2032. The sector can be further classified into the agricultural consulting services industry, the motion picture consulting services industry, the biological consulting services industry, the physics consulting services industry, the chemical consulting services industry, and the economic consulting services industry among others.
The sector recorded an output of almost $435 billion in 2022 followed by a forecast of almost $601 billion in 2032. The sector is also expected to experience a 1.0% increase in employment in the forecast years of 2022-2032. Some examples of companies in the management consulting domain include McKinsey & Company, Bain & Company, and Boston Consulting Group.
8. Information
Compound Annual Growth Rate in Industry Output (2022-2032): 3.3%
The information sector is one of the largest sectors in the United States. The information sector consists of the computing industry, the technology industry, and the software industry, to name a few. The sector recorded an output of almost $2.4 trillion in 2022 followed by a forecast of $3.4 trillion in 2032. The industry is also expected to experience a 1.0% increase in employment in the forecast years of 2022-2032.
7. Personal Care Services
Compound Annual Growth Rate in Industry Output (2022-2032): 3.5%
The personal care services sector engages in the provision of services in the beauty and fitness industry. The personal care services sector ranks fifth among the fastest-growing industries in the United States. In 2022, the sector reported an output of almost $513 billion and is expected to report an output of almost $722 billion in 2032.
6. Oil and Gas Extraction
Compound Annual Growth Rate in Industry Output (2022-2032): 3.5%
The oil and gas extraction sector engages in the exploration and production of petroleum and natural gas. The sector can be classified into three primary domains, exploration and production, transportation and storage, and refining and marketing. Prominent companies operating in this sector include Shell plc (NYSE:SHEL), Exxon Mobil Corporation (NYSE:XOM), and Chevron Corporation (NYSE:CVX). According to our methodology, the oil and gas sector is expected to grow to an output of almost $722 billion by 2032 at a compound annual growth rate in output of 3.5%.
For investors looking for high-growth opportunities, some of the top growth stocks to consider investing in include Alphabet Inc. (NASDAQ:GOOG), Microsoft Corporation (NASDAQ:MSFT), and Meta Platforms, Inc. (NASDAQ:META).