A First Look at U.S. Trade in Services by State
In 2024, the United States exported $1.2 trillion and imported $0.8 trillion in services. In the same year, it exported $2.1 trillion and imported $3.3 trillion in goods. The U.S. Census Bureau has primary responsibility for compiling statistics on U.S. exports and imports of goods and publishes them at both the national level and by U.S. state. The U.S. Bureau of Economic Analysis (BEA) has primary responsibility for statistics on U.S. exports and imports of services and publishes them at the national level, and it is working to produce state-level estimates.
Toward that objective, a recent BEA working paper by Scott Wingo presents an initial look at responses to BEA survey questions asking companies to report the top three states or territories, and the associated shares, for their sales to or purchases from foreign persons in 2022. The paper presents information about the data, estimation method, and exploratory results for a subset of services, referred to as “selected services (excluding financial and insurance services),” which covers a substantial portion of international services traded between businesses. It is the first installment of a BEA initiative to produce a complete set of statistics on trade in services by state, with future installments to cover other service types. The effort is expected to provide valuable information to policymakers at the national, state, and local levels about how exporting and importing affects state economies. The state-level statistics would also help business and academic communities assess emerging trends in the geography of U.S. trade in services. In addition, they could serve as inputs to BEA's efforts to estimate gross domestic product (GDP) by state on an expenditure basis, which would require measures of state-level international trade transactions as well as trade between states.
The paper finds strong geographic concentration: among reporting firms, the three states reported by firms account for 94 percent of exports and 90 percent of imports, and the leading state reported by each firm accounts for 86 percent and 77 percent, respectively. At the aggregate level, California, New Jersey, New York, Texas, and Washington account for 65 percent of exports and 57 percent of imports. Charts 1 and 2 illustrate the shares of exploratory results from each state for exports and imports, respectively.
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Nonresponse to the survey questions presents a primary remaining challenge. About 74 percent of exporters and 73 percent of importers responded to the survey questions; these firms accounted for around 65 to 75 percent of trade value in each direction in 2022. While larger traders (except some very large firms) were generally more likely to respond, nonresponse among small firms is especially important for smaller states. Among other findings, state services trade is positively associated with state GDP, and headquarters location is highly predictive of the location of services trade.
The author notes that more work remains, and established correlations with factors such as state GDP and headquarters location could serve as the basis for imputation of missing values. BEA plans a phased approach to estimating a complete set of statistics on trade in services by state. A series of publications will successively broaden BEA’s coverage by developing methods to estimate missing survey data and by introducing techniques for state allocation of other service types.
