The lack of updates for fundamental economic and trade statistics means industry executives are "flying blind"

The lack of updates for fundamental economic and trade statistics means industry executives are "flying blind"

Apparel and textile industry executives are among those being deprived of key trade and economic data amid the ongoing US government shutdown. And as Robert Antoshak, managing director at Olah Inc, explains, it comes at a time when trade tensions between the US and China mean that having access to the most up-to-date statistics is more important than ever.

Oh, the times in which we live! I never thought I'd ever feel compelled to write a column about a lack of statistics. Let me explain.

Say you're a sourcing executive and you'd like to know the latest imports of apparel into the US? Well, you can't find out because the site hasn't been updated.

Okay, so say you're a retail analyst, and you'd like to know how apparel sales stacked up over the holidays? Well, you can't find out because retail sales statistics haven't been updated since before the holidays.

Perhaps you're a mill owner and want to know how US textile exports fared during the fourth quarter? Well, you can't find out because these data are incomplete and haven't been updated for nearly a month.

A lack of updated market data equates to growing uncertainty and frustration in the market – and it's all brought to you courtesy of a US government shutdown. Many US government websites aren't being updated. Why is this? It has to do with a wall – and some stubborn politicians.

As has been widely reported, much of the US government is shut down; workers have been furloughed (typically without pay) and their duties go unheeded. Hence, things like updated trade statistics have gone dormant. About 800,000 government workers have been furloughed.

Politics are primarily responsible for the shutdown. President Trump ran on a pledge to build a wall between the US and Mexico to supposedly block "undesirable immigrants" and "terrorists" from Latin America. Initially, Trump claimed that Mexico would pay for the wall, but after Mexico rejected Trump's demands, he asked Congress several times for funds to build the wall – only to have been told no by the Congress.

When Congress turned down Trump's most recent request for funding, he responded by refusing to sign Congress's budget to keep the Federal government funded. Under the US system, Congress manages national funding decisions, which can be vetoed by the president. A tit-for-tat approach to fiscal policy that creates serious problems for the government bureaucracy to remain open.

Updates out of date

As a result, many US government websites have not been updated due to the lack of funding brought about by the stalemate over the border wall. For example, here's what you see if you access the US Commerce Department's Office of Textiles & Apparel website:

"Due to the lapse in government funding, the OTEXA website will not be updated until further notice."

OTEXA is the principal repository of US import and export statistics for our industry. As a consequence of the wall impasse, trade statistics are now a month out of date. Indeed, if the impasse continues for weeks or months, as some officials fear, then the trade data will become only more out of date.  

But here's the rub: it's more than merely an example of American politics run amok. Industry executives need these statistics to understand what's going on in their markets. And with all of the market uncertainty caused by the trade tensions between the US and China, having access to the most up to date statistics is more important than ever.  

For example, did US imports of clothing increase or decrease from China in November 2018? We don't know, because it's not published. The latest data available are through October.  

There are other agencies affected by the budget impasse including International Trade Commission, Census Bureau, the Department of Commerce – and even the State Department! Many of critical reports on national production and consumption statistics are presented on these websites.  

Bottom-line: if you want to know the latest statistics on US economic performance, you're likely out of luck. You'll have to live with old data instead – and guess at what's happening now. Indeed, the lack of updated data creates barriers to sound decision-making by executives throughout our supply chain.

Flying blind

In the cotton business, we have something called price discovery. Prices are tracked on commodity platforms, such as the ICE exchange, to help buyers and sellers of cotton to negotiate contract prices from a common basis. Without that, the markets would fly blind.  

But that's just what's happening with the lack of updates for fundamental economic and trade statistics. As an industry, we're flying blind, and the longer the standoff between the White House and Congress continues the more uncertain decision-making will become.

As an American, I am embarrassed by the situation, and reject the whole notion of such walls and barriers – but as an industry executive, I resent being forced to fly blind in a storm that was created by politics in the first place.

It's easy to whine about the state of American politics. But that's a topic for another time. My issue of the day is with the lack of essential data to make business decisions that have to be made regardless of the state of American politics. Moreover, it's ironic to consider that that the US government is now locked in secretive trade negotiations with China – another impasse that only adds to the opaqueness of information flowing (or not) out of Washington.

Website casualties

In any event, here's a listing of various US government economic-related data websites not currently being updated according to the Pew Research Centre in Washington, DC:

  • "The Census Bureau has ceased most operations, other than planning for the 2020 count. That means, among other things, no November data on new home sales (which were supposed to come out 27 December), construction spending (3 January), manufacturers' shipments, inventories and orders (7 January) and international trade (8 January). Unlike previous shutdowns, however, the Census website is running, giving people access to previously published data. The Federal News Network reports that the bureau has six to eight weeks of "carryover funding" it can use for planning purposes, but should the shutdown last longer than that even that work would cease. Activities funded otherwise than by annual appropriations, such as those paid for by other agencies or "non-Federal entities," may also be continuing.
  • "Like Census, the Bureau of Economic Analysis is part of the Commerce Department, and also has ceased operations for the duration. That could affect the bureau's first estimates of fourth-quarter and full-year 2018 gross domestic product, which are supposed to be released on 30 January.
  • "The Bureau of Labor Statistics is fully operational, as it is part of the Labor Department (which was funded back in September). That means the inflation report for December, scheduled to be released 11 January, is on track, a spokesman told us. That also goes for the releases of detailed jobs and unemployment data for December (the national-level data came out 4 January, and data for states and metro areas typically follow a few weeks later). But plans for the January jobs report, data for which are supposed to be gathered next week, are still uncertain: The BLS conducts the payroll survey of employers itself, but the Current Population Survey (which generates the data used to calculate the unemployment rate) is a joint effort with the Census Bureau.
  • "The Agriculture Department's main statistical offices, the National Agricultural Statistics Service and the Economic Research Service, are both closed. That means farmers will not have current data on global supply and demand for farm products, crop and livestock production estimates, and other agricultural economics matters. However, the Agricultural Marketing Service is continuing to provide market-price data for meat, grain, dairy products and other commodities.
  • "Although most employees of the Justice Department have been deemed essential and are still working (without pay), the office that includes the Bureau of Justice Statistics is an exception. That means data on crime, sentencing, prisons and other law enforcement topics aren't being updated. (The bureau did, however issue a report on 8 January about identity theft based on 2016 data.)
  • "The Bureau of Transportation Statistics, part of the Department of Transportation, had been operating normally except for the Office of Airline Information. However, a notice posted Tuesday said that, except for the Transportation Services Index for November (scheduled for release 9 January), all other statistical releases would be delayed due to the shutdown."

According to Pew, the following websites have not been affected by the shutdown, "because their departments have been fully funded by already-enacted appropriations laws. These are the Centers for Disease Control and Prevention, the National Center for Health Statistics, the National Center for Education Statistics and the Energy Information Administration. The Federal Reserve, which doesn't rely on Congress for funding, issued its monthly report on consumer credit on 8 January, and is scheduled to release its monthly report on industrial production and capacity utilization on 18 January. The Federal Housing Finance Agency, which funds itself through assessments on Fannie Mae, Freddie Mac and the 11 Federal Home Loan Banks, has continued its closely watched monthly reports on house prices and mortgage rates."  

Pew also makes a good point that "based on past experience, scheduled data releases may be delayed because of information-gathering backlogs even after the budget impasse is resolved and agencies fully reopen."

So even when the US government fully reopens, there will be a sizeable backlog of data that will have to be loaded onto government servers before all economic reporting is updated to current status. Yikes.