Sources_of_Service_Sector_Growth_Presentation.pptx

Service

1. The Rise of the Service Economy: Global Growth and Future Drivers Analyzing the Structural Shift in Global GDP and Employment

2. What is the Service Sector? Definition: The Tertiary Sector provides intangible goods (services) instead of tangible products. Key Characteristics (4 'I's): • Intangibility – Cannot be seen or touched before purchase. • Inseparability – Produced and consumed simultaneously. • Variability – Quality varies by provider/time/place. • Perishability – Cannot be stored. Major Sub-Sectors: • Modern: IT, Finance, Consulting, R&D. • Traditional: Trade, Transport, Education, Healthcare.

3. Global Economic Dominance • Service Sector contributes over 70% of GDP in developed economies. • Nearly half of global employment is now in services. • Structural Transformation Path: Agriculture → Manufacturing → Services. Rising incomes boost demand for education, healthcare, entertainment, and finance.

4. Key Drivers of Growth 1. Technological Advancements: • IT, AI, and automation enhance productivity and enable global delivery. 2. Rising Incomes & Demand: • Affluence shifts spending to high-value services (tourism, healthcare). 3. Specialization & Outsourcing: • Manufacturing depends on services (design, logistics, marketing). 4. Urbanization & Demographics: • Cities create concentrated demand; aging populations need healthcare.

5. The Role of Trade and Exports • Service exports outperform goods trade in resilience. • India’s IT & BPO success story illustrates global potential. Opportunities: • Financial Services • Telecommunications • Professional Consulting

6. Challenges to Sustainable Growth 1. Productivity Paradox: • Difficult to boost productivity in human-centric services. • Solution: Automation & AI adoption. 2. Skills Mismatch: • High-skill jobs (data science) vs. low-skill gig work. 3. Infrastructure Gaps: • Weak broadband/logistics limit growth. 4. Regulatory Barriers: • Complex licensing & data laws restrict service trade.

7. Future Outlook and Opportunities Healthcare & Wellness: • Telemedicine and digital health expand globally. Green Services: • Environmental consulting and green logistics grow with climate goals. AI-Human Frontier: • Generative AI and RPA improve personalization and speed.

8. Conclusion The Future is Service-Led: • Services drive global GDP and employment. Policy Imperative: • Invest in digital infrastructure, skills, and regulatory reform. Final Call: • Success lies in leveraging technology and human capital to deliver high-value, globally tradable services.