Financial markets in the United States are the largest and most liquid in the world. In 2018, finance and insurance represented 7.4 percent (or $1.5 trillion) of U.S. gross domestic product. Leadership in this large, high-growth sector translates into substantial economic activity and direct and indirect job creation in the United States.

Let’s start with the well-known sector of banking. Even if you don’t have a savings or checking account, you’ve probably passed by a bank or two. This sector is where you get your bank accounts, credit cards, loans and increasingly much more. Credit unions also offer many of the same accounts as banks, often with even more favorable interest rates. The main difference between credit unions and banks is the community and ownership that comes with being a credit union member versus being a bank customer.

Credit unions, financial advisors, discount brokerages and investment banks are also a part of this financial sector. Financial advisors range from accountants to retirement planners to tax preparers and more. Investment banks are tailored for more wealthy consumers. Here, you can find wealth management, tax advice and company guidance.

Financial advisors, discount brokerages and investment banks are also part of the banking financial sector. Financial advisors can specialize in accounting, tax preparation, debt repayment and a range of other financial needs. A financial planner is a type of financial advisor who specializes in creating long-term financial plans like saving for retirement. Investment banks are tailored for more wealthy consumers. Here, you can find wealth management, tax advice and company guidance.

The next financial services industry sector involves asset management. This is where pensions, insurance assets, hedge funds, mutual funds, etc. are handled. It’s important to note that nowadays, a certain financial product isn’t limited to just one financial sector. For example, both an asset management firm and an insurance company will have to manage insurance assets at some point, even though they are two different sectors.

The insurance sector provides, you guessed it, insurance policies. Of course this also encompasses a wide range of insurance needs from auto insurance to life insurance to health insurance. The insurance sector provides the underwriting and funding you need for all your insurance needs.

Then there is the private equity sector, which you may not be quite as familiar with. Private equity and venture capital funds provide companies with capital. In exchange, the private equity investors gain ownership stakes or a cut of the company’s profits. This is largely an entrepreneurial investment sector.

To be sure, these sectors don’t quite encompass the vastness of the financial services industry. There are tax filing services and companies, currency exchange services, electronic transfer companies and credit cards. These offerings are just as much a part of the financial services industry as investment banks or asset management firms.

Companies in this industry engage in financial transactions and create, liquidate, purchase, and sell financial assets such as securities, bonds, and insurance. Major finance and insurance companies include AIG, Bank of America, Citigroup, Fidelity, Goldman Sachs, JPMorgan Chase, MetLife, and Wells Fargo (all based in the US), as well as Allianz (Germany) AXA and BNP Paribas (both based in France), and Industrial and Commercial Bank of China (China).

Major global financial hubs include New York, London, Hong Kong, Shanghai, Los Angeles, and Singapore, according to the 2022 Global Financial Centres Index by Z/Yen. Top financial centers in Asia Pacific include Hong Kong, Shanghai, Singapore, Beijing, and Tokyo.

The US finance and insurance sector consists of about 475,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $4.5 trillion.


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Recruitment: Pipeline and Diversity
Among the challenges facing the financial services industry is a lack of a worker pipeline. Currently, industry employers often recruit workers from competing employers, failing to bring new workers into the industry. Additionally, the industry is faced with a lack of diversity among available workers. A diverse group of workers is especially important in service-oriented professions including retail, banking and insurance, where consumers often prefer employees with which they can relate.

Stemming from intense competition and high turnover rates, the financial services industry also faces low retention rates among workers. A lack of an industry-wide competency model makes it difficult for new workers to enter and navigate the career ladder in the industry.

Technical Talent Development
The financial services industry is heavily dependent on continuous skill development because workers must keep up with the rapidly changing array of products and services offered to customers. This reality requires employers to think more creatively about how to deliver on-demand training that can be accessed 24/7 and refreshed with new information as needed.

Jobs in the finance and insurance industry require a wide variety of skill levels. Many workers in this industry hold advanced degrees and professional certifications. Average wages for the sector in the US are moderately higher than the national average. At the high end, executives at investment firms often earn many times the national average. The overall injury rate is significantly lower than the national average.

Regulations passed in the aftermath of the financial crisis have increased demand for compliance specialists. The job outlook for financial examiners tasked with insuring compliance with laws governing financial institutions and transactions is expected to increase 21% (much faster than average) between 2021 and 2031, according to the US Bureau of Labor Statistics (BSL).


Recruitment: Pipeline and Diversity
Among the challenges facing the financial services industry is a lack of a worker pipeline. Currently, industry employers often recruit workers from competing employers, failing to bring new workers into the industry. Additionally, the industry is faced with a lack of diversity among available workers. A diverse group of workers is especially important in service-oriented professions including retail, banking and insurance, where consumers often prefer employees with which they can relate.

Financial services and products help facilitate and finance the export of U.S. manufactured goods and agricultural products. In 2017, the United States exported $114.5 billion in financial services and insurance and had a $40.8 billion surplus in financial services and insurance trade (excluding re-insurance, the financial services and insurance sectors had a surplus of $69.6 billion). The financial services and insurance sectors employed more than 6.3 million people at the end of 2018.

Investment in the U.S. financial services industry offers significant advantages for financial firms. As of 2018, at least 28 financial services companies out of all companies in Fortune’s Global 500 listing have chosen to locate their headquarters in the United States to take advantage of its creative, competitive, and comprehensive financial services sector. The industry offers the greatest array of financial instruments and products to allow consumers to manage risk, create wealth, and meet financial needs.

Regional & International Issues

Major companies based outside the US include Allianz (Germany), AXA (France), BNP Paribas (France), and Industrial and Commercial Bank of China. Demand for basic and sophisticated financial services is expected to grow faster in emerging markets than in mature ones. Major global financial hubs include New York, London, Hong Kong, Shanghai, Los Angeles, and Singapore, according to the 2022 Global Financial Centres Index by Z/Yen. Top financial centers in Asia Pacific include Hong Kong, Shanghai, Singapore, Beijing, and Tokyo.

Shanghai is working to become a global financial center to attract more foreign companies. The Chinese government’s support of loosening policies regarding interest rates and exchange rates should make it easier for outside firms to meet this growing demand for financial services.

In some developing economies, it is difficult to tell whether growth is fueled organically or by the government supplying large amounts of credit. Central banks play a crucial role in the development of countries, financing infrastructure projects and attracting foreign businesses. However, massive lending can lead to inflation and higher interest rates.

Catastrophe-related economic losses — increasingly tied to extreme weather — have been roiling the global insurance industry in recent years. In 2020, total economic losses from natural catastrophe events in 2020 were $190 billion and global insured losses from natural catastrophes were $81 billion in the same year, according to preliminary estimates from Swiss Re Sigma. The increasing frequency and intensity of natural disasters could result in large losses for insurers in coming years, according to the Office of the United Nations High Commissioner for Refugees.

In the US, the largest concentration of financial and insurance services activity is in California, Texas, Florida, New York, and Illinois. A significant number of financial firms are concentrated in New York City, where the New York Stock Exchange and many of the world’s largest corporations are located. The insurance industry has a considerable presence in California and is one of the largest employers in the state.

The volume of locally generated business for regional banks and insurance firms is related to economic and population growth. The fastest-growing states in the US include Idaho, Arizona, Nevada, Utah, and Texas, according to World Population Review.


The Finance and Insurance sector comprises establishments primarily engaged in financial transactions (transactions involving the creation, liquidation, or change in ownership of financial assets) and/or in facilitating financial transactions. Three principal types of activities are identified:
1. Raising funds by taking deposits and/or issuing securities and, in the process, incurring liabilities. Establishments engaged in this activity use raised funds to acquire financial assets by making loans and/or purchasing securities. Putting themselves at risk, they channel funds from lenders to borrowers and transform or repackage the funds with respect to maturity, scale, and risk. This activity is known as financial intermediation.

2. Pooling of risk by underwriting insurance and annuities. Establishments engaged in this activity collect fees, insurance premiums, or annuity considerations; build up reserves; invest those reserves; and make contractual payments. Fees are based on the expected incidence of the insured risk and the expected return on investment.

3. Providing specialized services facilitating or supporting financial intermediation, insurance, and employee benefit programs.
In addition, monetary authorities charged with monetary control are included in this sector.

Major financial and insurance products and services include loans, financial services,?investment advice, insurance products, transactions processing, trading financial instruments, and asset management. Financial and insurance firms create, liquidate, or change ownership of financial assets such as stocks, bonds, options, and insurance. Insurance accounts for about 50% of sector revenue, lending for about 40%, and securities services for about 10%.

Banks and credit unions, consumer finance firms, and other lenders primarily make loans or facilitate lending and offer account services, credit cards, and money management. They collect deposits and borrow from credit markets. Loan-related activities include production, underwriting, and servicing for residential, business, and personal loans. Firms facilitate lending by engaging in transactions on behalf of clients or by providing transaction services. Lenders increase their financial assets through returns on the loans they make.

Investment banks, hedge funds, and securities brokers issue and trade securities, facilitate securities activities, orchestrate mergers and acquisitions, and manage portfolios of assets. Securities brokers may conduct transactions on securities exchanges. Securities firms may also dispense investment advice, and perform in-depth risk analysis and economic research.

Insurance carriers and agencies pool risk by underwriting insurance policies or facilitating such underwriting. Insurance agencies create and sell property, casualty, and life insurance products to customers. Firms build reserves with the fees and premiums they collect from policyholders. Insurers increase their financial assets through investments made with reserves. Fees of policyholders are based on their risk levels and expected return on investment.

Mutual fund managers, financial planners, and investment advisers aim to achieve specific investment objectives through recommendations or by pooling assets together into a fund. Depending on the risk level of the fund, a manager may trade financial derivatives to bring about strong returns. The funds earn interest and pay out dividends. Firms may manage funds, create financial plans for investors, and dispense investment advice. Fund managers may have a team of analysts to conduct in-depth research and data analysis.


Firms use computer technology to carry out transactions, manage accounts, and market to potential clients. High speed networks are crucial for time-sensitive electronic transactions and trades. IT spending globally by banking and investment services firms is forecast to grow 6.1% in 2022 to $623 billion, according to Gartner. The IT-intensive banking industry makes up more than half of the total financial services IT spend.

Financial institutions, including many of the world’s biggest banks, are looking to blockchain technology — best known as the basis of the digital currency Bitcoin — to overhaul their existing infrastructures, speed settlements, eliminate billions of dollars in costs, and create new products. A coalition of banks is working to develop industrywide standards and use cases for the blockchain in banking, according to Investopedia.

Other technologies disrupting the finance and insurance sector include mobile devices for both internal and customer use. Mobile portals are popular with younger, digitally native consumers for depositing checks, paying bills, filing insurance claims, and even shopping for mortgages. As more consumers migrate to digital banking, banks are reducing staffing levels, closing or shrinking branches, and experimenting with new branch layouts focused on technology. In addition, the development of autonomous vehicles and advanced sensors will reduce risk for home and auto insurers, while the proliferation of sharing economies will homogenize risks. The impact of innovations and the business models they enable is creating significant uncertainty for traditional players and increasing competitive pressure from new entrants to the market.

Data security breaches and fraud prevention are rising concerns for financial institutions. Banks have also become increasingly concerned about cyberattacks that would destroy or lock data and have stepped up their efforts to protect themselves. A “doomsday project” called Sheltered Harbor, launched in 2016, required banks and credit unions to individually back up data so it can be used by other firms to serve customers of a disabled bank.


Competitive Landscape

Demand is driven by business activity, returns on investments, and consumer income. The profitability of individual companies depends on marketing, efficient operations, and investment expertise. Large companies often have advantages in access to cheaper capital, participation in large-scale transactions, and name recognition. Small companies can compete effectively through customer service, knowledge of the local market, innovation, and specialization. The sector in the US is fragmented: the largest 50 companies account for nearly 50% of sales.

The finance and insurance sector is undergoing rapid and significant change driven by advances in digital technology, connectivity, and competition from startups and other nontraditional industry players. New entrants and business models are reshaping the way financial services are structured, provided, and consumed, impacting the long-term structure of the financial services and insurance industries, according to a report by the World Economic Forum. Other forces for change in the sector include globalization and the growth of international trade, which has encouraged some US financial and insurance firms to expand into foreign markets. Foreign firms also are entering the US market. US fund managers often participate in foreign securities markets and some specialize in foreign investments.

In the aftermath of the late-2000s financial crisis, regulators enacted comprehensive financial regulatory reform measures, notably the Wall Street Reform and Consumer Protection Act (aka the Dodd-Frank Act), to rein in banks. Measures include heightened capital and liquidity requirements and prohibiting banking entities from engaging in certain proprietary trading activities, among other actions. While Dodd-Frank stopped short of breaking up the nation’s biggest financial firms, increased capital requirements and compliance costs, as well as indirect pressure from regulators, have been factors behind the breakup of some financial firms. However, the industry is anticipating significant relief from regulation under the Trump administration, which has vowed to dismantle Dodd-Frank. Regulations under review by the new administration include rules setting bank capital levels, as well as government designation of nonbanks, such as insurers, as “systemically important financial institutions.”

The traditional lines between business segments within the finance and insurance sector were blurred by the Gramm-Leach-Bliley Act of 1999, which permitted commercial banks to sell securities and insurance and enabled insurance firms to sell financial products. Deregulation led to the creation of gigantic financial services firms covering multiple industries and wide geographical areas, dramatically changing the landscape of the industry.

The financial services industry seems almost all-encompassing today. Banks not only offer checking and savings accounts, but many offer other products like mortgages and auto loans. However, it wasn’t always like that.

Before the 1970s, each sector of the financial services industry more or less stuck to its own specialty. Banks provided a place for customers to hold checking and savings accounts. Loan associations offered mortgages and personal loans. Brokerage companies offered consumers investment opportunities in stocks, bonds and mutual funds. And credit card companies, like Visa and Mastercard, solely provided credit cards.

But then during the 1970s, consumers began to move away from big banks, which were previously the center of the financial services industry. Federal regulations prevented banks from offering a variety of financial services which is what consumers wanted. So consumers increased their business with other sectors like brokers and mutual funds companies. As a response to save themselves, banks began to offer products like money market and mutual funds, mortgages and other loans.

By the 1990s, the lines that separated the different financial services sectors had become blurred. Not only were companies offering products outside of their original range, but companies were merging together to become bigger financial conglomerates. That would enable them to earn and offer even more.

Even still, the financial services industry continues to grow and change. This is largely due to rapid advances in technology. Certain financial products are becoming increasingly available to a wider variety of consumers thanks to the internet. There are even banks and financial advisors and banks that operate entirely online. Technology has opened new doors for both the financial services industry and its consumers.

Sales & Marketing

Finance and insurance firms serve a wide variety of borrowers and investors, engaging in transactions on behalf of individuals, businesses, and government agencies. Developing and maintaining long-term relationships are major goals of marketing and sales. Finance and insurance firms seek to promote and maintain their business through constant contact with executives and agents that deal directly with the end customer. Sales may be handled by a direct sales force, independent sales organizations, agents, or by customers themselves through the internet.

The internet and referrals are important sources of new customers. Long-term contracts are used for large loans, committing the customer to pay back borrowed funds over a fixed period of time. Many financial products are customized according to customer objectives and desired risk levels. For highly complex products such as insurance policies or mutual funds, the sales process is often handled by an in-house sales force with knowledge of the product.

A firm’s reputation for reliable performance and strong returns can be more important for customers than fees. Investors are attracted by the possibility of high returns, and will pay high fees for future returns. Pricing and fees are determined by risk level and asset size of the customer. Agents may receive commissions. Corporate clients and wealthy individuals command higher degrees of customer service and marketing efforts, due to the high fees and referrals they bring in.

Banks and credit unions attract both depositors and borrowers and often use separate marketing approaches for the two, emphasizing low costs for loans and high returns on deposits. Marketing is through newspaper and billboard ads, TV and radio, direct mail, the internet, and telemarketing. Because many consumers simply choose a bank close to them, a network of branches or ATMs is useful for acquiring new customers easily.

Investment banks, hedge funds, and securities brokers develop relationships with potential buyers of new securities and with corporations or governments that want to issue new securities or acquire other companies. Their respective sales force develops relationships with corporations and wealthy individuals to acquire capital. Institutional salespeople develop business relationships with large institutional investors, such as money managers, pension fund managers, and mutual fund companies. Private client service representatives provide brokerage and money management services for high-wealth individuals. The SEC in 2013 reversed a long-time ban on advertising by hedge funds and private equity funds. As a result, they are likely to spend more on marketing and branding their firms in order to attract new investors.

Insurance carriers and agencies depend heavily on referrals from existing customers; they also sell through banks, employers, car dealers, real estate agents, travel agents, and other channels. Because of the personal and local aspect of the insurance business, even large agencies and companies work through small local offices. Agencies or brokers that sell commercial or group health insurance typically use a direct sales force, advertise in local business publications, and may sponsor local business events. Agencies also focus on customer service, including 24-7 call centers, for marketing their products and services.

Mutual fund managers, financial planners, and investment advisers serve individuals or institutions such as insurance companies or pension plans. Large mutual fund companies like Fidelity have advantages in name recognition and can sell funds directly. Large companies typically advertise using TV, newspaper, and direct mail. Smaller funds rely more heavily on brokers to sell their shares. Managers often have relationships with independent financial and retirement fund advisers to make their funds available to participate in corporate pension plans.


Industry Subsectors
Banking: By the end of 2018, the U.S. banking system had $17.9 trillion in assets and a net income of $236.8 billion. The sector supports the world’s largest economy with the greatest diversity in banking institutions and concentration of private credit anywhere in the world. Fitch Solutions expects asset and loan growth in the U.S. commercial banking sector to remain solid in the next couple of years bolstered by above-trend economic growth.

Asset Management: The U.S. asset management subsector is unrivaled in its depth and diversity. U.S. asset managers are currently meeting the pension management needs of over 60 percent of the global retirement market.  Total U.S. retirement assets were approximately $28.2 trillion at the end of 2017. Moreover, if insurance assets and mutual funds are included, U.S. asset managers held nearly $51 trillion of long-term conventional assets under management in 2016 (more than 47 percent of the global total for these funds).

Insurance: In 2016, the insurance industry’s net premiums written totaled $1.1 trillion. According to NAIC data, premiums recorded by life and health insurers accounted for nearly 53 percent, and premiums by property and casualty insurers accounted for 47 percent.  Additionally, about one-third of all reinsurance sold worldwide is bought by U.S. firms. International insurance companies are actively seeking business partnerships and collaborations with U.S. insurance companies.

Venture Capital: The United States is the birthplace of the global venture capital (VC) industry, and it continues to support many of our most innovative companies. In 2017, $84 billion was invested in the U.S. VC industry across more than 8,000 different deals (Pitchbook), the highest amount since the early 2000s and a 16 percent increase from 2016. VC-backed companies employ 38 percent of the U.S. workforce of public American companies, and account for 82 percent of private sector research and development. These companies have historically generated revenue equal to 21 percent of U.S. GDP. (Stanford University and NVCA)

Private Equity: U.S. private equity firms invested more than $500 billion in U.S.-based companies in 2017. The private equity industry in the United States comprises nearly 4,700 investment firms, operating U.S.-based businesses in all 50 states. The industry owns over 30,000 private U.S. companies. These U.S. companies backed by U.S. private equity firms employ 11.3 million people in the United States and 19.6 million people worldwide. In 2017, business services and consumer-related businesses attracted the majority of U.S. private equity investment. (AIC)

Companies in the finance and insurance sector borrow from one another and from governments to finance their activities. For all US finance and insurance firms, annual capital expenditures average about 4% of sales. Insurance companies often provide services to customers prior to receiving payment, resulting in large receivables. To protect against interest rate increases, funds may trade interest-related futures contracts.

The sector is capital-intensive: annual revenue per employee varies from industry to industry but averages about $693,000 for the sector overall in the US.


Financial and insurance firms are highly regulated. Federal regulations enacted in the aftermath of the global financial crisis of the late 2000s are expensive for the finance and insurance industry in terms of compliance. At the same time, these regulations limit revenue growth and profitability by increasing capital and leverage ratio requirements, and limiting certain products or activities, such as short-term proprietary trading.

The most comprehensive financial regulatory reform measure since the Great Depression, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, increased government oversight of the finance and insurance industry with the aim of preventing another collapse of major financial institutions. Dodd-Frank created the Financial Stability Oversight Council to oversee financial institutions and the Consumer Financial Protection Bureau (CFPB), which scrutinizes financial institutions and how they interact with customers. Regulators of special importance to financial and insurance firms are the SEC, for securities markets; HUD, for mortgage origination; and state and federal governments, for depository institutions, insurance carriers, and agencies. Republican initiatives to re-evaluate Washington’s role in the housing market and to dismantle the CFPB and Dodd-Frank may gain traction under the regulation-averse Trump administration.

The Gramm-Leach-Bliley Act of 1999 allowed insurance firms, investment banks, and commercial banks to combine under a holding company structure. The act prompted industry consolidation and effectively allowed financial service firms to sell a variety of financial products spanning different industries.

The global financial crisis led to the Troubled Asset Relief Program (TARP), passed by Congress in 2008, which allowed the federal government to purchase up to $475 billion in toxic assets from financial institutions. In return, the government is monitoring those firms that received bailout money more closely. As of January 2019, some 978 recipients had received a total of $440 billion, of which $390 billion has been repaid.

Location Specific Industry Data :

Australia SA Midgee EDIT |COPY |DELETE
Great Britain NA Shop EDIT |COPY |DELETE
Canada NS Halifax EDIT |COPY |DELETE
Germany HE Wachtersbach EDIT |COPY |DELETE
Iceland NA Hvammstangi EDIT |COPY |DELETE
Austria BURGENLAND Oberreichenbach EDIT |COPY |DELETE
Italy CE Pontelatone EDIT |COPY |DELETE
Netherlands NH Amsterdam EDIT |COPY |DELETE
Belgium WLG Sougne-Remouchamps EDIT |COPY |DELETE
Switzerland NA Niederhelfenschwil EDIT |COPY |DELETE
Great Britain NA Kielder EDIT |COPY |DELETE
United States VT White River Junction EDIT |COPY |DELETE
Brazil PR Almirante Tamandare EDIT |COPY |DELETE
Netherlands NB Gassel EDIT |COPY |DELETE
Iceland NA Olafsvik EDIT |COPY |DELETE
Australia SA Bakara EDIT |COPY |DELETE
United Kingdom NA Gedney Hill EDIT |COPY |DELETE
Great Britain NA Backaland EDIT |COPY |DELETE
United Kingdom NA Neasham EDIT |COPY |DELETE
Switzerland NA Carouge EDIT |COPY |DELETE

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