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When a government shutdown halts the release of essential economic data, economists lose the nation’s most reliable gauges of employment, growth, and inflation. But they don’t stop analyzing — they start improvising.

Box office receipts, restaurant reservations, cardboard production, even data on garbage collection can give valuable clues about how American businesses and households are faring, particularly in this time of broad economic uncertainty. While economists agree that none of these can replace the scope and rigor of federal figures, until that official data starts flowing again, analysts are turning to an amalgamation of narrower public and private figures to try to understand economic trends.

“Economists are curious people,” said Allen Bellas, economics and finance professor at Metro State University who directs the graduate program. “And there are benefits of figuring out a good indicator that people might not have thought about before.”

### Impact of the Government Shutdown on Economic Data

When the government shut down on October 1, some of the workers responsible for collecting, analyzing, and publishing the data that informs policy and business decisions also stopped working. Since then, the Bureau of Labor Statistics (BLS) has not released the planned September jobs report and has delayed the release of the September Consumer Price Index (CPI), a key measure of inflation, from this week to October 28.

The CPI figure is especially important because it is used to calculate the Cost of Living Adjustment (COLA) for nearly 70 million Social Security beneficiaries, ensuring their checks keep pace with rising prices.

This federal economic data is considered an important gauge of the broader economic environment. States, municipalities, business owners, investors, and households use it to make investment, employment, and spending decisions. Meanwhile, academics and private-sector economists depend on federal data to inform growth models, predict recessions, and provide quality research upon which others rely.

### Alternative Sources of Economic Data

Researchers have learned over the years that there are alternative indicators they can turn to as measures of past and future economic performance. This approach has been particularly helpful when studying countries without resources for data gathering or where government data manipulation may be a concern. However, historically, researchers have been able to rely on the U.S. for accurate and timely data.

“Most other countries do not have the kinds of data we collect. And the reason we’ve done this is because it benefits our citizens, our taxpayers, our businesses. So they’re the ones that are going to be impacted the most,” said Erin McLaughlin, senior economist at The Conference Board.

### Pandemic Pushed Economists Outside the Box

During the pandemic, the importance of timely data pushed economists to supplement official government figures with real-time data from unconventional sources. Examples include:

– Demand for cardboard boxes
– Pollution data
– Garbage collection data
– State unemployment insurance claim numbers
– Daily airline passenger traffic from the Transportation Security Administration
– Credit and debit card transactions from card companies
– Port and rail activity
– Labor market data from payroll processing companies like ADP and UKG
– Restaurant booking data from OpenTable
– Hotel occupancy rates
– Home listing and sale prices from Zillow and realtors

These indicators helped economists shift from forecasting the future to “nowcasting” — using a wealth of unconventional data to create real-time measures of changing costs, hiring environments, and consumer confidence. This information is crucial for time-sensitive business and household decisions, said George Tawadros, associate professor of economics at Winona State University.

However, while useful in the moment, nowcasting does not provide the holistic economic view needed for longer-term planning.

“Those are good indicators, but they are subsets of what is happening in the economy,” said Marcus Bansah, associate economics professor at St. Olaf College.

### The Indispensable Role of Federal Data

For informed decision-making, economists emphasize the need for a more holistic approach, which requires federal government data. Ming Lo, economics and finance professor at Metro State University, divides federal data into three broad categories:

– Labor market statistics, including unemployment rates and job vacancies
– Output-related data, such as gross domestic product (GDP)
– Price data, such as the CPI inflation index

While private or state-level metrics can capture aspects of these categories imperfectly, the federal data remains essential. For example:

– Labor market data can draw on state unemployment rolls and private firms’ payroll information from ADP, UKG, or job search websites like Glassdoor and Indeed.
– GDP is difficult to measure without BLS data, yet it is vital for businesses making decisions about hiring, production, advertising, or investment.
– Pricing data, particularly inflation, has no true substitute in the private sector.

Moreover, government agencies rely on these metrics to make policy decisions, such as workforce development programs tailored to specific industries.

The social implications are high as well, given that the federal government must send out Social Security checks to nearly 75 million Americans. The amount they receive depends on inflation data, typically measured by the CPI.

“For measures like job openings or unemployment claims, there are reasonably good alternative sources. But for others, the void is much harder to fill. Pricing data, particularly inflation, is a prime example — there’s no true substitute for that information in the private sector,” said Allison Shrivastava, economist at Indeed Hiring Lab.

### Making Best Guesses Amid Data Gaps

Some economists are less concerned about the broader lapse in data releases. While some major headline figures are delayed, other agencies like the Federal Reserve, which is self-funded, continue to publish data.

Paul Kasriel, an independent economist and former Northern Trust chief economist, said he relies heavily on unemployment claims data, which he considers more reliable than the BLS jobs report due to its frequent revisions.

“These data count real people who have an incentive to get in line to collect benefits,” Kasriel explained. Still, he noted that the CPI report is the government data he misses most during this shutdown.

Michael Pearce, deputy chief U.S. economist at Oxford Economics, believes his firm can still make educated forecasts despite the absence of some official data.

“At this stage, when we’re only missing a month’s data, we’re operating under pretty foggy skies, but we have a pretty good idea of where things stand,” Pearce said. “Relative to other advanced economies, we still have one of the best data systems in the world.”

Economists have been using proxies such as private payroll data, unemployment claims, card transactions, and gasoline demand to model the missing figures, though results are imperfect.

“These private data don’t have the statistical power to tell us if we’re going into a recession,” Pearce cautioned. “The official data serve as the anchor, the benchmark for all these private models.”

He warned that if the shutdown extends for months, the lack of government data could begin influencing critical decisions on Wall Street and at the Federal Reserve.

### The U.S. Statistical System: The Backbone of Economic Analysis

Even though creative alternatives exist, economists agree that the U.S. government’s statistical system remains the backbone of economic analysis.

“Government data is really the gold standard for inflation and it’s needed for markets to function,” said Courtney Shupert, economist at MacroPolicy Perspectives. “There’s no perfect substitute. Many private estimates are benchmarked to government data, especially regional indicators that rely on federal statistics for weighting and sampling.”

Economists also noted that the last government shutdown in 2018-19 did not cause data disruption to this extent, nor did it occur during such a critical economic juncture.

“The last shutdown did not occur during a moment of big change like what we’re seeing lately, which is a decrease in immigration, unemployment ticking up, fewer job openings, and early signs of consumers feeling some pressure,” Shupert said.

These pressures on businesses and households heighten the importance of understanding the current state of the economy, even if the picture is imperfect without federal data.

For now, the shutdown serves as a stress test of the private sector’s data capabilities, and a reminder of how deeply our economic system depends on robust public data sources.
https://www.minnpost.com/economy/2025/10/private-data-fills-the-gap-imperfectly-as-government-shutdown-halts-key-economic-reports/