By 

David Payne 

and 

Fenwick Yu, 

Office of the 

Chief 

Economist 

U

.S. exports of private services exceed a 

half trillion dollars, and account for 

nearly one third of all U.S. exports of goods 

and services.*

Growth in exports of services has outpaced 

the rise in imports. The U.S. trade surplus in 

services rose to a total of $168.0 billion in 

2010. The surplus has grown quickly since 

2003, rising $101.2 billion. 

Financial and business services contribute 

the most to the U.S. surplus, though fees for 

software and industrial process licenses, 

other royalties, and education services also 

contribute significantly.

The surplus in travel and passenger fares 

increased $29.8 billion from 2003 to 2010.

The largest U.S. surpluses in services by 

country are with Canada, Japan, Ireland, 

Brazil, the United Kingdom, China, and Mexico.

The U.S. services surplus with China has accelerated rapidly since 2007, from $2.4 billion to $10.4 billion in 2010, because of 

sharp gains in exports and relatively flat imports. Gains have been realized across all 

categories of services.

The largest U.S. services deficit is with Bermuda, which is a major source of U.S. reinsurance imports. The second largest is with 

India, primarily because of U.S. purchases of 

computer services.

The largest U.S. deficit by service type is in 

insurance. U.S. insurers purchased $41.2 

billion more in reinsurance than they sold in 

2009.

U.S. Trade in Private Services

May 2011

U.S. Department of Commerce

Economics and Statistics Administration

Executive Summary

ESA 

Issue Brief 

#01-11

*Services are non-tangible items of value, such as: 

travel, shipping, tuition, phone service, computer processing, and software licenses. Private services exclude 

government.

U.S. Exports, Imports and 

Trade Balance

U.S. exports, imports, and trade balance in 

private services are seen in Figures 1 and 2. 

U.S. exports of private services amounted to 

$526.6 billion in 2010, an increase of 8.8% 

from 2009. Imports totaled $358.6 billion, an 

increase of 7.1%. (See Figure 1.) Exports and 

imports have grown sharply every year but 

one after 2003. Exports have grown an average of 9.2% per year, while imports have 

grown an average of 7.4%. 

Figure 1: Exports and Imports of Private Services Billions of dollars

1992 1995 1998 2001 2004 2007 2010

0

100

200

300

400

500

600

0

100

200

300

400

500

600

Exports Imports

Source: Bureau of Economic Analysis.

Figure 2: Trade Balance in Private Services Billions of dollars

1992 1995 1998 2001 2004 2007 2010

0

50

100

150

200

0

50

100

150

200

Source: Bureau of Economic Analysis.
2 U.S. Department of Commerce, Economics and Statistics Administration

Unlike U.S. trade in goods, U.S. trade in services 

has consistently shown higher exports than imports. The U.S trade surplus in private services 

rose from $66.7 billion in 2003 to $168.0 billion in 

2010. (See Figure 2.)

Figures 3a and 3b show exports, imports, and the 

trade balance in the services categories for which 

disaggregated data are collected. Limited 2010 

DEFINITIONS

Services are non-tangible items of value that are either consumed when purchased or at a later date as specified 

by the terms of sale, such as school tuition or an airplane ticket. These are distinct from tangible items or 

“goods,” such as oranges or motor vehicles.

Non-tangible items of value that foreign persons and companies purchase from the United States are U.S. 

exports of services. These include: visits to the United States; passenger fares paid by foreigners to U.S. airlines to reach U.S. destinations; use of U.S. freight and port services; payment of royalties and fees for the 

rights to use processes, software, or other items owned by U.S. persons and companies; education in the 

United States; and the purchase of commercial and miscellaneous services from U.S. persons and companies. Services provided by U.S.-owned affiliates in foreign countries are not included in the export figures.

Non-tangible items of value that U.S. persons and companies purchase from other countries are U.S. imports 

of services. These include: travel in another country; passenger fares paid by U.S. persons to foreign airlines 

to reach foreign destinations; use of foreign freight and port services; payment of royalties and fees for the 

rights to use processes, software, or other items owned by foreign persons and companies; education in 

another country; and the purchase of commercial and miscellaneous services from foreign persons and companies. Services provided by foreign-owned affiliates in the United States are not included in the import figures.

The difference between U.S. exports and imports is the U.S. trade balance.

Private services do not include service transactions by the U.S. government (including the military).

data were available.1

The largest category of exports of services by the 

United States was for travel (foreigners visiting the 

United States), which totaled $103.1 billion in 

2010. After travel, the largest categories of exports 

were for financial services ($58.0 billion) and miscellaneous business services ($56.8 billion).2 On 

the import side, the largest categories were travel 

* 2010 data.

Management, consulting

Other royalties, fees

Figure 3a: U.S. Exports, Imports of Private Services in 2009-10 by Type

Billions of dollars

Travel*

Financial* Misc. business 

Freight & port use*

Software licenses 

Industrial licenses*

Passenger fares*

Education*

Research & devel. 

Insurance*

Computing Miscellaneous*

0 30 60 90 120

Exports

Imports

Source: Bureau of Economic Analysis

Management, consulting

* 2010 data.

Other royalties and fees

Source: Bureau of Economic Analysis

Figure 3b: U.S. Trade Balance in Private Services in 2009-10 by Type

Billions of dollars

Travel*

Financial* Misc. business 

Freight & port use*

Software licenses 

Industrial licenses*

Passenger fares*

Education*

Research & devel. 

Insurance*

Computing Miscellaneous*

-60 -30 0 30 60
U.S. Department of Commerce, Economics and Statistics Administration

3

by U.S. citizens visiting other countries, which 

amounted to $74.6 billion in 2010, followed by 

insurance ($56.5 billion) and commercial freight 

and port use ($49.0 billion).

3

The United States is a net exporter in most services categories. The largest U.S. trade surplus is 

in financial services ($42.2 billion in 2010), followed by software licenses, miscellaneous business services and travel. The largest U.S. deficit 

is in purchases of insurance (an estimated $41.9 

billion in 2010). The United States is also a net 

purchaser of commercial freight and computing 

services. 

Figure 4 indicates how the U.S. trade balance in 

services has changed over time.4 The United 

States has gained in all four major categories 

since 2003, to a total gain of $101.2 billion in 

2010. Of these, royalties and license fees accounted for the greatest gain, $38.6 billion. 

Travel and fares gained $29.8 billion, other private services $27.8 billion, and freight and port 

use $4.9 billion. 

It is also possible to look at these data at a country-specific level. As seen in Figure 5, the United 

States has the greatest surplus with Canada, followed by Japan, Ireland, Brazil, the United Kingdom, China, and Mexico. The United States has a 

surplus with nearly all other countries. The 

greatest deficits are with Bermuda, where there 

is a concentration of reinsurers, and with India, 

as a result of U.S. purchases of computer services.

 U.S. Surplus with China is 

Growing Rapidly

The last few years have seen tremendous growth 

in the U.S. surplus in trade of private services with 

China. U.S. exports of private services to China 

have been rising at an average annual rate of 

18.4% since 2003, and have gone from $5.7 billion 

in 2003 to $20.1 billion in 2010. U.S. imports of 

private services from China, on the other hand, 

reached a peak of $10.6 billion in 2007, but then 

fell to $8.3 billion in 2009, and have picked up to 

$9.7 billion in 2010. (See Figure 6.) The U.S. surplus 

Figure 4: Trade Balance in Private Services

Billions of dollars

1992 1995 1998 2001 2004 2007 2010

-40

-200

20

40

60

80

100

-40

-20 0

20

40

60

80

100

Royalties and

license fees

Travel and fares

Freight and port use

Other private services

Source: Bureau of Economic Analysis.

Figure 5: Largest U.S. Surpluses and Deficits by Country in 2010*

Private services trade, billions of dollars

Canada

Japan

Ireland (2009)

Brazil

United Kingdom

China Mexico

India

Bermuda (2009)

-30 -20 -10 0 10 20 30

Source: Bureau of Economic Analysis. * 2009 data is used if 2010 is not available.

Figure 6: Exports and Imports of Private Services -- China

Billions of dollars

1992 1995 1998 2001 2004 2007 2010 05

10

15

20 05

10

15

20

Exports

Imports

Source: Bureau of Economic Analysis.
with China has gone from $1.9 billion in 2003 to 

$10.4 billion in 2010, almost all of which has taken 

place in the last three years. (See Figure 7.)

The large increase in the U.S. surplus with China in 

the last three years (from 2007 to 2010) is mostly 

from an increase in the surplus of “other private 

services” and of travel and fares, and a lessening in 

the deficit of ocean freight and port services. (See 

table.) Roughly half the surplus growth in “other 

private services” comes from education services to 

Chinese students studying in the United States. 

The other half is in business and financial services. 

Travel and fares exports jumped 39.0 percent in 

2010 alone. The improvement in the deficit of 

ocean freight and port services likely comes from 

faster growth in U.S. goods exports to China. U.S. 

goods exports rose an average of 13.2 percent per 

year over the past three years, while U.S. goods 

imports increased an average of only 4.3 percent 

per year. 

Most of the detailed data categories are only available for 2009. (See Figure 8.) The largest U.S. services receipts from China were travel and fares 

($5.0 billion), education ($3.0 billion), freight and 

port use ($2.2 billion), and other business and 

technical services ($1.4 billion). The two largest 

categories of services the United States purchased 

4 U.S. Department of Commerce, Economics and Statistics Administration

The Change in the U.S. Trade Surplus in Services 

with China, 2007 to 2010

Billions$

Total change over three years +8.0

 Other private services +2.7

 Travel and passenger fares +2.4

 Ocean freight and port services +1.9

 Royalties and license fees +1.1

Source: Bureau of Economic Analysis 

Figure 7: Trade Balance in Private Services -- China

Billions of dollars

1992 1995 1998 2001 2004 2007 2010

0

2

4

6

8

10

0

2

4

6

8

10

Source: Bureau of Economic Analysis. Source: Bureau of Economic Analysis.

Management, consulting

Other business, technical

Figure 8: U.S. Trade in Private Services with China in 2009-10

Billions of dollars

Travel and fares*

Education

Freight & port use*

Financial

Industrial licenses

Construction

Leasing

Software licenses

Computer services

Research & devel.

All other

0 1 2 3 4 5

Exports

Imports

* 2010 data.
from China were travel and fares ($3.1 billion) and 

freight and port use ($2.9 billion).

The only services where the United States has a 

trade deficit with China are research and development ($0.8 billion), computers ($0.6 billion) and 

freight and port use ($0.6 billion).

U.S. Department of Commerce, Economics and Statistics Administration

5

Largest U.S. Non-Insurance 

Services Deficit is with India

In the years just before the 2008-09 global economic crisis, U.S.-India trade in private services 

expanded rapidly. U.S. imports from India rose at 

an average annual rate of 38.1% from 2003 to 

2008, while U.S. exports to India registered a 

21.1% average annual growth rate. Exports and 

imports resumed growth in 2010, albeit slowly. 

(See Figure 9.)

The United States had a trade surplus in services 

with India until 2006. Since then, there has been a 

growing trade deficit. The U.S. trade deficit in services with India has grown from $0.9 billion in 

2006 to $2.9 billion in 2010. (See Figure 10.)

Most of the detailed data categories are only available for 2009. (See Figure 11.)

U.S. imports of computer and data processing services from India were $5.5 billion, accounting for 

nearly half of all U.S. imports from India and 32.5 

percent of U.S. global imports of these services. 

This category also contributed significantly to the 

U.S. services trade deficit with India, as the United 

States exports minimal computer services to India. 

U.S. imports of research and development, management and consulting, and other business and 

technical services from India are also significant 

and have contributed to the U.S. services trade 

deficit. 

Two types of services helped to reduce the size of 

the U.S. deficit. U.S. exports of education services 

to India ($3.2 billion) were significantly higher than 

imports. Travel and fares of Indian citizens visiting 

the U.S. were $4.0 billion, while U.S. citizens visiting India spent $2.3 billion in this category.

Figure 9: Exports and Imports of Private Services -- India

Billions of dollars

1992 1995 1998 2001 2004 2007 2010 02468

10

12

14

16 02468

10

12

14

16

Source: Bureau of Economic Analysis.

Exports

Imports

Figure 10: Trade Balance in Private Services -- India

Billions of dollars

1992 1995 1998 2001 2004 2007 2010

-4

-3

-2

-10123

-4

-3

-2

-10123

Source: Bureau of Economic Analysis.

Figure 11: U.S. Trade in Private Services with India in 2009-10

Billions of dollars

Travel and fares*

Education

Software licenses

Computer services

Research & devel.

All other 0 1 2 3 4 5 6

Exports

Imports

Source: Bureau of Economic Analysis.

Management, consulting

Other business, 

 technical

* 2010 data.
6 U.S. Department of Commerce, Economics and Statistics Administration

U.S. imports of insurance services were $40.6 billion larger than U.S. exports of the same in 2009, 

because of the U.S. importing reinsurance services 

from foreign companies.5 Reinsurance takes place 

when an insurance company gives part of its premium revenue from policies it has sold to another 

insurer in return for the other insurer taking on a 

part of the responsibility for the risks. U.S. imports 

of reinsurance primarily come from six countries 

or regions: Bermuda, Switzerland, the Caribbean, 

Ireland, Germany, and the U.K. Bermuda, alone, 

accounts for around half of total imports and Switzerland accounts for twenty percent of the total. 

(See Figure 12.)

 Insurance is Largest Services 

Deficit

Endnotes

1 Source is Bureau of Economic Analysis, at 

www.bea.gov/international/. Quarterly data are 

found at “balance of payments detailed estimates.”Annual data is found at “international services.”

2 Miscellaneous business services include engineering 

services, equipment maintenance and repair, telecommunications services, leasing, legal services, advertising, and other.

3 U.S. insurance companies purchased a net of $41.2 

billion in reinsurance from foreign companies in 

2009. See the section that discusses the U.S. trade 

deficit in insurance.

4 The Bureau of Economic Analysis to date has reported 2010 data on these four categories; more 

detailed data will be forthcoming.

5 The Bureau of Economic Analysis measures insurances services as the difference between premiums 

paid and payouts for a “normal” year’s loss. The latter is calculated by a weighted formula that includes 

a six-year moving average of frequent losses and a 20

-year average of infrequent or catastrophic losses. 

Insurance services also include investment income 

earned on funds owned by policy holders, commissions, brokering, loss adjustment and other.

David Payne

(202) 482-3698

E-mail: dpayne@doc.gov

Fenwick Yu

(202) 482-0322

E-mail: fyu@doc.gov

The authors are economists in the Office of the Chief 

Economist of the U.S. Department of Commerce’s 

Economics and Statistics Administration. Direct all 

inquiries to: 

U.S. Department of Commerce

Economics and Statistics Administration

1401 Constitution Ave., NW

Washington, DC 20230

www.esa.doc.gov

Source: Bureau of Economic Analysis.

Figure 12: U.S. Trade Balance in Reinsurance in 2009, by Country

Billions of dollars

Bermuda

Switzerland

Caribbean

Ireland

Germany

UK

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