Fortune's rankings are based on sales

Since then, auto-making giant General Motors (GM) and Exxon - now Exxon Mobil - have battled for the title of largest company. GM last held the spot in 1999 and fell to third place this year.

Analysts say the change is emblematic of the seismic changes ongoing in the US economy.

"The shift from making stuff to providing services has, of course, been happening for years," says Cait Murphy, senior editor at Fortune.

Consumer driven

Manufacturing today employs a much smaller share of the US workforce than it did in 1953, when more than a third of all workers were employed in factories.

Today just one in five American workers is employed in manufacturing.

Manufacturing's much-reduced role in the economy is not a phenomenon unique to the United States, says David Blitzer, chief economist at Standard & Poor's, which also produces a list of top-500 US firms.

"Any advanced service economy has seen manufacturing decline in terms of its share," Mr Blitzer told BBC News Online.

Wal-Mart achieved top-list honours in a year in which consumers were seen as saviours to the US economy, he says. They continued to buy big-ticket items as well as lesser-priced goods even as US corporations slashed expenses and cut jobs.

The only other retailer that made the top 20 was popular do-it-yourself home improvement chain Home Depot.

Enron's surprising debut

Wal-Mart's ascendancy was not unanticipated given it made number two in last year's rankings.

Readers of the latest Fortune 500 might have been surprised, however, to find bankrupt energy trader Enron weighing in at number five, up two places from last year's ranking.

Surprise! Enron is No 5

Fortune said Enron's achievement came amid "a year of accounting weirdness".

"To begin with," says Fortune's Carol Loomis, "Enron, going by the restated financials it issued for the first nine months of the year, inarguably was a large company."

She also says Enron's December bankruptcy filing does not disqualify it from appearing on the Fortune 500. In addition, Enron has yet to report its earnings for the last three months of 2001.

"The missing quarter, in which we knew revenues had fallen dramatically, gave us a problem," she says.

The host with the most

Enron, along with other energy companies, rose so quickly on the Fortune 500 thanks to an accounting quirk that allowed them to show the value of energy trades as revenue.

It is akin to an estate agent reporting his salary in terms of the value of the homes he sold in a given year rather than the commission he earned on sales.

This "super-charged" method of accounting," Ms Loomis says helped propel another energy firm, American Electric Power, to number 13, up from number 146 in 2001.

California and New York continue to top the list of states with the most Fortune 500 companies.

California has 56, while New York has 51, 39 of which are in New York City.

In addition, most of the Fortune 500 are traded on the New York Stock Exchange, which also has its headquarters in Manhattan.