The U.S. Office of Management and Budget (OMB) requires federal statistical agencies to announce any planned change in data collection, analysis, or estimation methods that may affect the interpretation of a principal economic indicator as far in advance of the change as possible. Agencies shall fully explain unforeseeable changes to Principal Federal Economic Indicators due to special circumstances as soon as they are known and in the first report affected by the change. See OMB Statistical Policy Directive No. 3: Compilation, Release, and Evaluation of Principal Federal Economic Indicators.
BLS economic indicators depend on the information that individuals, households, and businesses provide.
The information here describes how the special circumstances resulting from national, state, and local emergency actions to reduce the spread of COVID-19 may affect the Principal Federal Economic Indicators:
BLS price indexes measure price changes in baskets of goods and services purchased by consumers, sold by businesses, and traded across U.S. borders. The information herein describes aspects of data collection, estimation, and publication that could possibly affect the interpretation of the BLS price index Principal Federal Economic Indicators.
Effects of COVID-19 Pandemic and Response on the Consumer Price Index
The Consumer Price Index (CPI) is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services. The CPI estimates for March 2020, published on April 10, were the first CPI release since the national emergency was declared on March 13, 2020.
- How are prices collected for the CPI? Price data used to calculate the CPI are primarily provided by two different surveys that are administered continuously each month:
What happens if BLS cannot collect CPI data? The percentage of prices in the CPI sample that may be unavailable, either because the outlet is closed or the item is out of stock, is expected to increase. When BLS cannot obtain a price either because of data-collection limitations or the item being unavailable, it will generally be considered “temporarily unavailable.” The CPI program has specific procedures for handling temporarily unavailable prices. Missing prices are generally imputed by the prices that are collected in the same or similar geographic area and item category. Essentially, the price movement of items that are not collected is estimated to be the same as those that are collected for a given item and geographic area. See the "Cell-relative imputation" section on page 20 of the CPI Handbook of Methods chapter for a brief technical discussion of this procedure. Note that this type of imputation is used in the CPI every month, especially in categories where response rates are relatively low.
Were there any changes to CPI data-collection operations? Yes. BLS suspended all in-person data collection in the Seattle, Washington, area on March 5, 2020. On March 16, 2020, BLS suspended all in-person data collection. Upon suspension of in-person data collection, CPI data collectors were instructed to attempt to collect data normally collected by personal visit by telephone, email, or by internet from the website of the establishment, if a website exists. CPI data collectors were specifically instructed not to contact establishments by telephone when it would cause an undue burden on respondents. These types of establishments include hospitals, physician’s offices, grocery stores, department stores, and restaurants.
Will data collection for CPI expenditure weights be affected? The Consumer Expenditure Survey (CE), a household survey capturing consumer spending data, is used to calculate relative importances (weights) of goods and services in the CPI market basket. CE in-person data collection ceased on March 19, 2020. CE data are collected by the U.S. Census Bureau through an agreement with BLS. The Census Bureau is transitioning to collecting these data through telephone. Changes to CE survey operations will not have an immediate impact on CPI data, but may have long-term impacts. These weights are used in the chained CPI index (C-CPI-U). The March 2020 weights will be incorporated in the final March 2020 chained CPI indexes, which are released in February 2021. BLS also incorporates the CE weights in a biennial weight update to the CPI-U and CPI-W indexes. These weight updates will be effective with the January 2022 indexes, released in February 2022. BLS is working on mitigation strategies to reduce measurement error of CPI weights caused by a potential loss of CE survey data.
How will the CPI for airline fares be affected? The CPI airline fares index measures price change of personal commercial air travel. The CPI airline fares sample is selected based on variables such as points of origin and destination, airline, class of service, and fare (First Class, Coach Full Fare, and Coach Discount Fare). A price quote will be collected even if an airline carrier reduces flights, as long as one flight option is available in the time band. The number of price quotes may fall if a route is cancelled entirely and the route is in the CPI sample. Price quotes for the current period are not subject to adjustment once collected; thus, a change or cancellation of a flight in the month that prices are collected is not reflected in the price index. More information on the airline fares consumer price index is available at Measuring price change in the CPI: Airline fares.
Will CPI data be published as scheduled? The CPI monthly estimates of price change will be published as scheduled. See the schedule of CPI release dates. BLS is closely monitoring fallback collection efforts to ensure that data meet quality standards. While it is probable that estimates will be based on a smaller amount of collected prices than usual, CPI procedures are designed to allow for estimates even when data collection is disrupted. During the government shutdown of October 2013, CPI estimates were published for October, despite data collection ceasing due to a lapse in funding from October 1 to October 16.
Under what circumstances would some data not be published? A CPI index is not published if it fails a data-quality standard known as an adequacy ratio. Specifically, if BLS fails to collect at least one price in a geographic area that account for more than half the geographic weight of the index, the index is not published. Even in months without disruptions, some minor indexes with small samples occasionally fail this standard and are not published. (One example is Repair of household items.) Data-collection disruptions would have to be extremely severe for major CPI indexes not to be published based on this standard. Data-collection disruptions may be more severe in some area than others, and it is possible that some data for metro areas may fail data quality-standards and not be published. BLS will continue to monitor data-collection disruptions.
Will BLS attempt to quantify the overall impact of the COVID-19 pandemic on CPI estimates? The primary goal for the CPI is to provide accurate estimates of price change. While it is not possible to precisely quantify the impact of COVID-19 pandemic and response efforts on price change estimates because its effects cannot be separated from other influences on the economy, we can show some impacts on data collection for each affected month.
- Commodities and Services Pricing Survey, an establishment survey of businesses selling goods and services to consumers, used to provide the price data for the CPI.
- Housing Survey, a survey of landlords and tenants used to provide rent data for CPI’s shelter indexes.
Survey operations for CPI pricing surveys may be affected by limitations on data-collection staff, the availability of survey respondents, and the availability of items. Note that CPI data are collected throughout the entire month. Specifically, any given price in the CPI sample is collected in one of three defined pricing periods, corresponding roughly to the first 10, second 10, and final 10 days of the month. BLS uses several data-collection modes for CPI surveys that include telephone, internet, and automated electronic data capture. However, the majority of data are collected by personal visit. About 65 percent of CPI price data and 50 percent of CPI rent data are typically collected by personal visit. This type of collection has been suspended since March 16, 2020. (It was suspended on March 5th in the Seattle area.)
How does the CPI handle forgiveness, reduction, or nonpayment of rent in its shelter indexes? To collect rent values, CPI data collectors identify respondents for each sampled housing unit when they are initiated into the sample. Respondents could include its occupant (the renter), its owner (the landlord), a property manager, or an authorized representative of the occupant. However, in a given month when the unit is priced, the data collector could attempt to contact more than one of these respondents to get data on a sampled housing unit. For example, if the occupant is unavailable, the property manager might be contacted.
Specifically, the respondent is asked:
1. How much rent (are you/is the tenant) paying for this (house/apartment) now?
2. What period of time does that rent cover?
Most often the answer to question 2 is 1 month, but occasionally rent might be for a different length of time, or rent for a part of a month may be prorated.
When an unusually large price change is reported by a respondent, the data collector typically attempts to investigate the situation and confirm the change. For instance, if a tenant reports a large decline, the data collector will attempt to confirm this with the landlord or property manager. Relevant to the COVID-19 pandemic, when a tenant reports being unable to pay rent, the data collector is instructed as follows (from the manual used by CPI data collectors):
Be sure to probe these situations to determine if any rent obligation will be forgiven.
- If the landlord expects payment in full, regardless of when, enter the full rent amount that is due.
- If some or all of the rent is being forgiven, enter the amount the landlord/manager has agreed to accept.
- If the rent is not paid or not expected to be paid AND the landlord/manager is unsure about the future, enter $0.00.
These are all longstanding procedures, with the exception of the final bullet addressing situations of uncertainty, which have generally not arisen in the past.
Although some units in the rent sample, notably those under rent control, are excluded from owners’ equivalent rent calculation, a unit would not be excluded from the computation of owners' equivalent rent simply on the basis of a large decline in rent paid.
Note that a free or $0 price in the CPI is adjusted to a small positive value, typically a value equal to a 95-percent reduction from the previous price. (Prices of zero do not work well in the formulas used to compute the CPI.) The sample of rental units used to calculate the indexes for rent and for owners' equivalent rent in the CPI is separated into six panels. Each panel, which contains around 6,000 units, is priced every 6 months. The monthly price relative is the 6th root of the 6-month price change. For additional information on the calculation of the index, see “How the CPI measures price change of owners’ equivalent rent of primary residence and rent of primary residence.”
Effects of COVID-19 Pandemic and Response on the U.S. Import and Export Price Indexes
The U.S. Import and Export Price Indexes survey publishes indexes that measure average price movements for imports to the United States and exports from the United States on a monthly basis. The indexes for March 2020, published on April 14, were the first release since the national emergency was declared on March 13, 2020.
- How are prices collected by the survey? Most prices used to calculate the U.S. Import and Export Price Indexes are collected from sample establishments that are selected based upon their relative trade value in imports and exports during the course of a year. Sample establishments are asked to provide prices on a monthly basis, as close as possible to the first day of the reference month. Prices are collected through a secure internet site. When a sampled item is not traded, the respondent is asked to provide an estimated price if one is available. When a price is not available, it is imputed by the prices of similar items that have been collected. In some areas such as crude petroleum, select metals, diamonds, air passenger fares, and export grains, data are collected from alternative data sources.
- Will data collection be affected? Data collection may be affected both by the availability of survey respondents and the availability of alternative data sources. The prices are provided by business survey respondents. All of the data are collected electronically through a secure internet site. If some respondents are unable to provide prices as the result of an interruption in normal operations, collection will be adversely impacted. Some prices depend on alternative data sources from other government and corporate entities. Any interruption in the availability of the data may result in temporarily suppressing the publication of select price indexes.
- Will data be published as scheduled? The monthly estimates of price change will be published as scheduled. See the schedule of U.S. Import and Export Price Indexes release dates. While it is probable that estimates will be based on a smaller amount of collected prices than usual, procedures to calculate aggregate estimates can account for fewer prices and maintain reliability. Detailed price indexes may be suppressed for publication if insufficient prices are collected.
- Will estimates be affected by the COVID-19 pandemic and response? The March 2020 estimates did not show impacts as a result of the COVID-19 pandemic and emergency response efforts because the reference period for the data is the first week of the month. However, subsequent releases may be affected if emergency measures remain in place and respondents are not available to report data.
- Will BLS attempt to quantify the overall impact of the COVID-19 pandemic on estimates? The primary goal for the U.S. Import and Export Price Indexes is to provide accurate estimates of average price movement for imports to and exports from the United States. There is not a way to precisely quantify the impact of COVID-19 pandemic and response efforts on any price movement because the effects cannot be separated from other influences on the economy. Comparisons of price movement for a specific month against those of recent months may provide a general indication of the impacts. Locality of Origin Import Price Indexes and Locality of Destination Export Price Indexes may provide indications of an impact relative to specific trading partners. BLS also can provide information on overall program response rates relative to the time period before the widespread impact of the COVID-19 pandemic and response efforts in the United States.
Effects of COVID-19 Pandemic and Response on the Producer Price Index
The Producer Price Index (PPI) is a measure of the average change over time in the prices domestic producers receive for the sale of their products. PPI estimates for March 2020, published on April 9, were the first PPI release since the national emergency was declared on March 13, 2020.
- Will data collection for PPI be affected? The PPI survey is voluntary, so it relies on business survey respondents to provide pricing information. The unavailability of survey respondents or the interruption of business operations could affect the ability to collect PPI pricing information.
- How are PPI data collected? Price data used to calculate the PPI are collected primarily online through the BLS Internet Data Collection Facility. For most industries, the PPI pricing date is the Tuesday of the week that includes the 13th of the month. If a transaction did not occur on the pricing date, the respondent is requested to provide a price for a transaction prior to that date, as close to the pricing date as possible. If no transaction occurred during the month, the respondent is requested to provide an estimate of what the price would have been, had a transaction occurred.
- What happens when PPI data cannot be collected? When BLS cannot obtain a price, missing prices are imputed by the prices of similar items that have been collected. Essentially, the price movement of items that are not collected are estimated to be the same as those in their general index category. See the "Missing prices" section on page 10 of the PPI Handbook of Methods chapter for a brief discussion of this procedure. Note that this type of imputation method is the standard operational procedure used by the PPI program each month when estimating missing prices. Imputation allows indexes to be calculated, even when a fairly small number of prices are collected.
- Will PPI sample updates be affected? BLS periodically updates the sample of producers providing data to reflect current conditions more accurately when the structure, membership, technology, or product mix of an industry shifts. BLS usually updates 40–50 industries a year, through three sample update cycles. The next PPI sample update is scheduled to occur with the release of June PPI data on July 10, 2020. As of the close of March 2020, a majority of the data necessary for this sample update were collected and the sample update is expected to proceed as scheduled. Future sample updates will depend on the availability of the survey respondents in our new samples to provide data on a timely basis.
- Will PPI data be published as scheduled? The PPI monthly data measuring producer price change will be published as scheduled. See the schedule of PPI release dates. While it is possible that indexes will be based on a smaller than usual quantity of collected data, PPI ensures published indexes meet predefined quality standards. (See question #6.)
- Under what circumstances would some PPI data not be published? Companies voluntarily provide proprietary pricing information for the survey, so BLS goes to great lengths to ensure survey respondent confidentiality and statistical accuracy of indexes. As such, while index calculation continues, BLS may suppress some indexes. BLS would suppress indexes where a low level of response could result in the identification of survey respondents or if index quality declines to the point where BLS believes the estimated index is unreliable. All PPI data are subject to recalculation 4 months after initial publication, so it is possible indexes initially unavailable may be published 4 months after original calculation if we receive enough price information for the month.
- Will BLS attempt to quantify the overall impact of the COVID-19 pandemic on PPI estimates? The primary goal for the PPI program is to provide accurate estimates of producer price change. While it is not possible to precisely quantify the impact of the COVID-19 pandemic and response efforts on price change estimates because these effects cannot be separated from other influences on the economy, PPI can provide information on overall program response rates relative to the time period before the widespread impact of the COVID-19 pandemic and response efforts in the United States.
Last Modified Date: May 14, 2020