Missing Data Accompanying Missed Paychecks as Government Shutdown Continues

The economic pain felt by unpaid federal employees and their dependents as the partial federal government shutdown persists is an increasingly visible reminder of the very real and very human costs of this political staredown. Because of the shutdown, some 800,000 federal workers may struggle to pay hundreds of millions of dollars in rent and mortgage payments, to say nothing of basic day-to-day costs including gas, electricity, heat and food.

But beyond the visible financial toll, there is a cost that is much harder to see and to quantify but may arguably be longer-lasting: When the government shuts down, workers go temporarily unpaid while some crucial federal data could go permanently uncollected.

The Census Bureau was scheduled to publish monthly new construction permits and starts data for December this morning, but the release was delayed because of the federal government shutdown. The delay comes at a critical moment for the American economy, amidst growing uncertainty about the underlying health of the housing market – and each missing or delayed data point adds to that uncertainty for buyers, sellers, developers, investors and local governments.

And the longer the federal government shutdown continues, the more we run the risk of transitioning from inconvenient delay of regular federal data releases, to a more troubling lack of federal data collection itself. The data collected and published each month by the federal government represents more than a current snapshot of market trends. This data is part of the ongoing economic and cultural timeline of the nation, intended to be used not just by current analysts, but by future researchers intent on looking to the past as a means of informing their present.

Prior government shutdowns have resulted in very real distortions in the national record that cannot be corrected after the fact. During the federal government shutdown from December 1995 to January 1996, the Census Bureau delayed follow-up interviews for respondents to the Current Population Survey (CPS), resulting in lower response rates that impacted data quality. This longstanding federal benchmark survey provides critical labor market data points including the unemployment rate and labor force participation rate, and disruptions in collecting this data led to permanent distortions in the interpretation of economic and demographic trends from that time.

Today, we run the risk of not just replicating, but potentially exacerbating, those same distortions. Monthly CPS data are collected during the calendar week that contains the 12th day of the month, and the current shutdown already extends beyond that – and continued delays could forever distort the interpretability of January CPS data when they are eventually released. More worrying, compared to the mid-1990s, continuous survey data collection is even more important today since responses to the annual American Community Survey (ACS) are also collected throughout the year.

Ultimately, the less data collected and published by the government, the fewer decisions there are that can be made based on that data and the more vulnerable we are to economic surprises or lack of foresight. This lack of data being collected and published is much more than inconvenient at this point – it is close to becoming a real national problem with no easy solution the longer it lasts.

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