The Efficacy of Using Economic Census Data as a Frame Source for PPI

Collin Witt

Abstract

For most industries, the Producer Price Index (PPI) uses for its sampling frame data that originated from the Quarterly Census of Employment and Wages Program of the Bureau of Labor Statistics. Ideally, the proper measure of size for the PPI would be the total revenue of each unit. Because total revenue is not readily available for most of the units, the PPI uses employment size instead. It is believed that employment size and revenue are highly correlated for the manufacturing sector. Considering the fact that the Economic Census (EC) has total shipments and receipts, we investigate the efficacy of using EC data as an alternative frame source for PPI sampling.