Financial Sector

A designation for the portion of the economy in which people trade financial assets.

The financial sector includes a broad range of organizations that manage money, including credit unions, banks, credit card companies, insurance companies, consumer finance companies, stock brokerages, investment funds and some government sponsored enterprises. In the U.S. the financial sector accounted for 8.4 % of the country's Gross Domestic Product (GDP) in 2011, a greater share than it had in 2006 and one of the highest percentages of the past half 21st century. Moreover, as of March 2011, the financial industry was generating 29 % of all profits in the U.S. Therefore, a solid and well-functioning financial sector generates local savings, which in turn lead to productive investment in local business. This in turn is the powerful engine behind economic growth.