As the world's largest economy, the United States has several industries that prop up its annual GDP of $23tn. The tech companies operating on the West Coast are some of the world's biggest. Today, we will dive deeper into their operations and learn how they affect the US economy with innovative business practices.
As the US economy is the biggest and the most robust on the planet, Big Tech still calls the country home. Other aspects to consider include high employment rates, a strong dollar internationally, and low inflation rates. However, having powerful corporations that provide millions of jobs in the country is the most critical piece of the jigsaw.
The current climate
It's no secret that Apple is the most prominent tech company in the world at the moment. Although there have been mass layoffs within the sector, Apple has managed to avoid the savage cuts that we have seen across Western tech behemoths such as Meta and Google. However, there have been rumors that some are in the pipeline, so don't be surprised to see them come into play in the coming months.
The American economy is teetering on the brink of recession and although it has managed to avoid the dreaded "R" word, many economists believe the Biden administration is simply delaying the inevitable.
Apple, Alphabet, Microsoft and Amazon contribute over 25% of America's GDP. This figure is astonishing and it is clear that any mention of negative sentiment toward these companies results in a shudder throughout the American and global economies. This should give you some indication of how influential these companies are - when they're doing well, the American economic outlook is positive.
The tentacles of the big four
It isn't just a case of numbers on a sheet, although the amount these companies contribute to the world's largest economy is almost incalculable. It is what these companies do that makes them so innovative - being at the forefront of the tech sector, you realize they significantly affect almost every level of the economy.
There are over 80 million iPhone users in America, a number that is predicted to grow. This is nearly a third of the US population. Alphabet's most significant subsidiary is Google, the world's most visited website and the most dominant search engine. Microsoft provides an office system used by hundreds of millions of customers worldwide.
Although Amazon has experienced a steep decline in business activity and profitability of late, they're still the number one commerce store online. All of these companies complement each other. You can access one using the services of the other and vice versa.
They're all interwoven into the fabric of America and Western society. By becoming goliath industries in their sectors, they are at a stage where their business moves are examined at the highest level. Providing millions of jobs, they act as the trident tips to the tech revolution that has developed since the early part of the 21st century.
The future of Big Tech
The bigger question is whether these companies have peaked. There aren't many sectors in the history of industry that have obtained the market cap and profit these four companies have over the last two decades. So, irrespective of whether the American economy slides into a recession, these companies may have - to some extent - been awaiting a downturn for many years anyway.
Some countries are looking to tempt Big Tech companies to their shores with attractive tax arrangements. In addition, there are whispers about the US dollar losing its footing as the global reserve currency. The decline of these tech companies might be an acceleration of the inevitable, and they could also be suffering from some kickback due to the current American economic situation.
Conclusion
Five years ago, it seemed unthinkable to question any decline of the tech industry or the US dollar. Still, the last 12 months have proved we shouldn't rule anything out regarding the global economic outlook, and both possibilities are now in play.
The US economy is a juggernaut that consists of some of the most iconic names and brands on the planet. While it wouldn't precisely disappear without the existence of Big Tech, its emergence over the last 25 to 30 years has been a key reason why America has remained at the top of the global economic table.
With China in hot pursuit, this may change over the next 10 years, but if any of these companies shut up shop and look to set up their HQ in another country, this would spell dark times for the future of the American economy.
