One of the effects of the longest government shutdown in U.S. history has been a loss of critical economic data about inflation and jobs.
The Bureau of Labor Statistics saw its work slow and then stop in October, leaving large gaps in economic data. The Washington Examiner spoke with three former BLS commissioners who served under a combined five presidents about what might come once the government shutdown ends.
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While there have been several shutdowns that have affected the data collection agencies, this one is far different, given its duration. The shutdown also came at a pivotal time for an economy that is still facing inflation and indications of a slowing labor market.
William Beach, who led the BLS from 2019 to 2023 under Presidents Donald Trump and Joe Biden, said that one of the first things that will happen with the BLS after the shutdown ends will be the announcement of a new release schedule featuring the reports that have gone unreleased over the past several weeks. It should show specific calendar dates for when lapsed reports from the shutdown era will be made public.
The Senate this week finally voted to reopen the government after some Democrats defected and joined Republicans in voting for a short-term funding bill. And on Wednesday night, the House followed suit, voting to reopen the government after nearly 43 days.
What reports have been missed?
Several key reports have been skipped amid the government shutdown. Notably, the employment reports for September and October were never released because BLS employees have been furloughed since the start of October. The Job Openings and Labor Turnover report for September was also missed.
Also, important inflation reports have lapsed. The producer price index reports for September and October were never released. The consumer price index report for September was released, but the CPI report for October, scheduled for Thursday morning, is delayed.
In fact, the White House speculated on Wednesday that the employment report and CPI report for last month might not ever be released.
“The Democrats may have permanently damaged the Federal Statistical system with October CPI and jobs reports likely never being released,” said White House press secretary Karoline Leavitt. “All of that economic data released will be permanently impaired, leaving our policymakers at the Fed, flying blind at a critical period.”
When could the reports be released?
The main question now is when those lapsed reports will be released and in what form.
One of the main challenges is retroactively collecting data from the month of October, which was the only full month that the BLS was out of commission, according to Erica Groshen, who led the agency from 2013 to 2017 while Barack Obama was president.
“When the shutdown ends, the BLS experts in every program are going to have to figure out what data they can recover from October, the data they otherwise would have expected to collect that is recoverable, and what’s not recoverable,” she said.
Groshen predicted that some reports would be released more quickly than others, specifically the September reports that were scheduled to be published last month but were never released. She said those might come out rather quickly, just because the data was already collected in September, before the start of the government shutdown.
“So there are some things that were collected already, and they just need to be processed,” she said, pointing to the September PPI report that was supposed to have been released on Oct. 16. She said it might take a week or so to process that.
Beach predicted that the missing September jobs report might be the first, or one of the first, economic reports to be released after the shutdown ends.
“My guess is it’s not only fully collected and fully processed, but probably it’s fully written up,” Beach said of the September employment report.
“It’s October that I’m really worried about,” he added.
Some reports will be more complicated.
Katharine Abraham, who served as the BLS commissioner from 1993 to 2001 under former Presidents Bill Clinton and George W. Bush, noted that the employment reports consist of two parts: the household survey data, which provides the unemployment rate, and the payroll jobs numbers.
“We’ve lost the household survey data for October, we’re not going to get it I don’t think,” she said. “I can’t imagine a scenario where those data are filled in retrospectively.”
Groshen also expected that surveys of businesses would be more successful than those for households.
“If you are surveying firms, then the larger they are, the more likely they are to have all of this information electronically, and they can just look it up,” Groshen said.
Beach said that because of the missing household survey, there might not be an official October unemployment rate.
He also emphasized that there was no data collection for the CPI in October, stating that this is particularly problematic because about 70% of the data is dependent on people collecting data from stores.
“The other 30% comes from third parties that provide us data on housing costs, gasoline, new and used cars — so all that data is somewhere in the IT resources at BLS, but you can’t build a full index just on 30% of the data,” he said.
Beach said he isn’t sure what the BLS will do because there is really no precedent for the situation. He said it’s possible that the BLS could only have a partial October CPI and then try to fill in the blanks next month.
“Which means that they’ll take the September and the November and interpolate for the missing October numbers,” Beach said.
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But the PPI is a little different. That is because data for that price index is primarily collected electronically. Beach said that if businesses were submitting their data for the PPI in October, that data should be in electronic collection centers.
Still, it isn’t clear exactly how the BLS will handle the release of its reports this time around. Groshen said that staffing cuts at the BLS might also make it more difficult for the agency to handle such a long shutdown.
