UNITED STATES OF AMERICAWhat’s happening in this economyThe USA is the largest economy in the world. The currenteconomic expansion is the second longest on record andis predicted to continue into 2018–19. Its unemploymentrate is approaching historically low levels, with thecurrent rate of 3.7 per cent the lowest since 1969. The USA is well known for its entrepreneurship andinnovation, as well as high levels of R&D expenditure. Itis a global leader in technology and high-valuemanufacturing sectors.1Innovation is a key driver of economic growth in the US.The Trump Administration's National Security Strategy(NSS) shows the clearest policy direction in innovationand technology to date. The NSS states that the US willnurture a healthy innovation economy, collaborate withallies and partners, improve STEM education, draw on anadvanced technical workforce, and invest in early stageR&D. US R&D priority areas include autonomoustechnologies (cars and weapons), data science,encryption, gene editing, nanotechnologies, newmaterials, advanced computing technologies and AI.2Decisions by US firms on outward investment andinternational expansion will be influenced by the recentTax Cuts and Jobs Act, which reduces the corporate taxrate from 35% to 21%. This decrease was a key part ofthe new tax framework with the goal of attracting andretaining investment. The R&D tax credit was maintainedin the Trump Administration’s tax reform package ofDecember 2017.Trade, investment, and commercial opportunitiesand activities There are more than 4,000 Australian parent companies in the US:this includes 1,500 individual entities and more than 3,000 individual points of presencemajor firms include Austal, BHP, Lendlease, Macquarie Group and Servcorp1United States Country Risk Report – Q3 2018 BMI Risk Reports; London, (Third Quarter 2018).2Note: This Insight is current at October 2018. Refer to Disclaimer on the final page.iKey facts and figuresPopulation: 325.9 mil-lion GDP growth: 2.9% (2018)Predicted GDP growth for 2018–19: 2.4%GDP per capita: USD 62,152 (2018)Political system: con-stitutional federal re-publicTwo-way trade/key goods and services traded: AUD 68 billion Demographic trends Millennials are projected to outnumber Baby Boomers by 2019.