Private Sector

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DEFINITION of 'Private Sector'

The part of the economy that is not state controlled, and is run by individuals and companies for profit. The private sector encompasses all for-profit businesses that are not owned or operated by the government. Companies and corporations that are government run are part of what is known as the public sector, while charities and other nonprofit organizations are part of the voluntary sector.

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BREAKING DOWN 'Private Sector'

In most free-market economies, the private sector is the sector where most jobs are held. This differs from countries where the government exerts considerable power over the economy, like in the People's Republic of China. The Bureau of Labor Statistics tracks and reports both private and public unemployments rates for the U.S.

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RELATED FAQS
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