Measuring Up in a Changing Economy: A Look at New U.S. Service Sector Data and Why It Matters

Access to timely economic information is crucial for policymakers as they respond to booms and busts. While services industries have grown to account for more than half of U.S. output, until recently, the nation has lacked up-to-date information on this sector’s activity, making it more difficult to detect turning points in the economy. Further, the absence of regularly collected federal statistics on activity in the finance, insurance and real estate industries have impeded real-time monitoring of conditions in the services industries that were at the heart of the financial crisis.

The Census Bureau is filling this important gap in our nation’s data needs through its new quarterly survey of services sector activity. On March 12, one day after the first census quarterly release on the output of finance and insurance firms, Economic Studies at Brookings hosted a discussion on how the new data can better inform economic policy. Deputy Secretary of Commerce Dennis Hightower delivered the keynote address and senior representatives from the Census Bureau and the Bureau of Economic Analysis then explained what’s now available and how it will be used to improve our estimates of GDP. A concluding panel included the perspectives of analysts from the public and private sectors.

Brookings Vice President and Co-Director of Economic Studies Karen Dynan introduced Hightower and moderated the panel. After each session, speakers took questions from the audience.