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Real Time Economic Data: Challenges and Opportunities

Paper Session

Saturday, Jan. 7, 2023 2:30 PM - 4:30 PM (CST)

Hilton Riverside, Grand Salon C Sec 15 & 18
Hosted By: American Economic Association & Committee on Economic Statistics
  • Chair: Stephanie Aaronson, Brookings Institution

Business Closures and (Re)Openings in Real Time Using Google Places

Thibaut Duprey
,
Bank of Canada
Daniel E. Rigobon
,
Princeton University
Philip Schnattinger
,
Bank of England
Artur Kotlicki
,
Bank of England

Abstract

We present a new method to measure business opening and closure rates using real-time information from Google Places, the dataset behind the Google Maps service. Our Canadian application confirms the importance of temporary closures and reopenings during the COVID-19 pandemic. Over 50% of the temporarily closed food and retail businesses during the April 2021 lockdown reopened by the end of September. Our estimates align well with the timing of COVID- 19 restrictions and are validated by a survey of recently opened businesses. Our framework provides policy-makers with a tool for the timely monitoring of business dynamics.

The Importance of Blended Data: Measuring Employment at a Weekly Frequency

Tomaz Cajner
,
Federal Reserve Board
Leland D. Crane
,
Federal Reserve Board
Ryan A. Decker
,
Federal Reserve Board
Adrian B. Hamins-Puertolas
,
Federal Reserve Board
Christopher J. Kurz
,
Federal Reserve Board

Abstract

The pandemic has demonstrated that timely, high-frequency data can provide pivotal economic insights in real time, allowing policymakers and businesses to quickly observe rapid changes in the economy. The elevation of nontraditional data has also highlighted the value of traditional products from statistical agencies given the need to benchmark and validate new data sources. We outline the transformation of a monthly employment indicator based on ADP payroll microdata into a weekly index, emphasizing the value of blending traditional and nontraditional data. We build off Cajner et al. (2018 and 2022) and construct weekly measures of both active (on payrolls) and paid (receiving a paycheck) employment. This new approach entails weekly seasonal adjustment and benchmarking to BLS aggregates at the industry level. The weekly series provides high-frequency insights while also facilitating easier comparison with monthly BLS payroll concepts than did prior work with ADP data. Additionally, we show that the difference between paid and active employment measures can be used as a proxy for temporary dislocation, an important factor in early pandemic labor markets. Finally, we document how the weekly employment indexes have fared during the pandemic jobs recovery, with particular interest in the benchmark revision to the publicly available data for the second half of 2021.

Measuring Business Trends and Outlook through a New Survey

Catherine Buffington
,
U.S. Census Bureau
Lucia Foster
,
U.S. Census Bureau
Colin Shevlin
,
U.S. Census Bureau

Abstract

The Census Bureau’s new Business Trends and Outlook Survey (BTOS) provides timely information from businesses on their current trends and expectations over core concepts such as prices, employment, and revenue. BTOS collects qualitative information in order to produce extensive margins for core economic phenomena. BTOS results are representative of all single-location nonfarm businesses in the United States. We highlight sectoral differences in extensive margins of employment and prices using Finance and Insurance and Accommodation and Food Services as examples. We find businesses especially in Accommodation and Food Services anticipate future output price increases, possibly to accommodate rising current input prices.

Business Applications as Economic Indicators

Jose Asturias
,
U.S. Bureau of the Census
Emin Dinlersoz
,
U.S. Bureau of the Census
John Haltiwanger
,
University of Maryland
Rebecca Hutchinson
,
U.S. Bureau of the Census

Abstract

How are applications to start new businesses related to aggregate economic activity? This paper explores the properties of three monthly business application series from the U.S. Census Bureau’s Business Formation Statistics as economic indicators: all business applications, business applications that are relatively likely to turn into new employer businesses (“likely employers”), and the residual series -- business applications that have a relatively low rate of becoming
employers (“likely non-employers”). The analysis indicates that growth in applications for likely employers significantly leads total nonfarm employment growth and has a positive correlation with it, whereas growth in all applications and applications for likely non employers have weaker positive correlations and shorter leads. Furthermore, growth in applications for likely employers leads growth in nearly all of the monthly Principal Federal Economic Indicators (PFEI) included in this study. Impulse response functions from vector autoregression analysis indicate that growth of both total nonfarm employment and advance monthly sales in retail and food services have positive and long-lasting responses to innovations in growth of applications for likely employers. Overall, applications for likely employers appear to be a strong leading indicator of monthly PFEIs and aggregate economic activity, whereas applications for likely non-employers provide early information about changes in increasingly prevalent self-employment activity in the U.S. economy.

Discussant(s)
Erica Groshen
,
Cornell University
Kenan Fikri
,
Economic Innovation Group
JEL Classifications
  • C8 - Data Collection and Data Estimation Methodology; Computer Programs
  • L2 - Firm Objectives, Organization, and Behavior