SAVED BY SERVICES - EMPLOYMENT, GROWTH AN D THE SERVICE SECTOR

This article discusses the role of the service sector in generating ec onomic growth and employment. We argue that defining, measuring and di stinguishing service output as opposed to output of goods has become i ncreasingly difficult, which makes the traditional attempts to define a specific role for the service sector more or less futile. Instead, i t is argued that the diverse activities performed within the service s ector form an integral part of a well-functioning economy as a whole. Worrying about the relative size of the service sector helps us little : what matters is each sector's contribution to the overall productivi ty growth.