Macroeconomics in Beverage and Tobacco Product Manufacturing
Based on the North America Industry Classification system (NAICS), Beverage and Tobacco Product Manufacturing is among the most performing industries that contributed to the economy of the country (US Census Bureau, 2007). The industries engaged in the manufacture of soft drinks and ice making. Today, this industry is playing an important role in the economic growth of the country. For instance, it is among the industries with the greatest number of employees earning a living through various companies in Beverage and Tobacco, such as Pepsi and Coca Cola. The industry meets the needs of about 320 million American consumers as well as many consumers in the globe. Thus, in this paper, I will address macroeconomics in Beverage and Tobacco Product Manufacturing.
Size and growth rate in the economy
Beverage and Tobacco Product Manufacturing has a lot of establishments and employees. In terms of establishment, the industry has firms such as Coca Cola and Pepsi that deals with the manufacture of non-alcoholic drinks. Under non-alcoholic drinks, there are ice-manufacturing firms. For example, there are more than 26,882 establishments operating in the industry. In addition, the industry has employed more than 1.5 million people in the US. Based on this, the industry contributes a lot to the economy of the US. In 2016, the industry attained a GDP of $218,652 million (US Census Bureau, 2007). The percentage change in GDP ranged from 12% in Odessa to -7.8% in Enid.
Newsworthy microeconomic indicators
Interest rate is an important aspect that should be considered by any business organization. Beverage and Tobacco industry has a responsibility to monitor the interest rates. For instance, the current interest rate in the US is 1.75%. In regards to this, most of the companies in the industry can acquire some loans at a lower interest, which can be used to increase its production process. Changes in the interest rate can affect the repayment deals where these companies can pay more funds.
The trend in macroeconomic indicator
GDP is a macroeconomic indicator that shows the performance of an economy. A high GDP is an indication of positive economic growth, meaning that a country is doing well while a low GDP is an indication of negative economic growth, meaning that a country is performing poorly. For instance, from 2009 to 2010, there was a decline in the GDP, which was a negative representation U.S. (Bureau of Economic Analysis, Gross Domestic Product by Industry, 2019). However, from 2010 to 2016, there has been a positive change in GDP, representing a positive change.
Sources; U.S. Bureau of Economic Analysis, Gross Domestic Product by Industry (2019).
Beverage and Tobacco Product Manufacturing is likely to advance their operations to match the rising GDP. In the future, the industry will increase its innovation strategy. Innovation is an emerging trend for capital companies that are investing in food production. The industry has been doing well in the market, contributing a lot to the economic growth of the US as a whole. For instance, the industry has employed more than one million people in the US. Thus, with this contribution, I think the organization has a duty to make sure that the standard is kept. The companies in the industry will need to be more innovative to deliver to the consumers based on the current trends. Beverage and Tobacco Product Manufacturing is an important industry in the US.
US Census Bureau. (2007). North American industry classification system (NAICS).
U.S. Bureau of Economic Analysis, Gross Domestic Product by Industry (2019). Private Industries: Nondurable Goods Manufacturing: Food and Beverage and Tobacco Products Manufacturing for Southeast BEA Region [SESTFOODBEVTOBMANNGSP], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/SESTFOODBEVTOBMANNGSP