Simonson Says: Speaking Out for Integrity of Key Statistics

I testified on June 20 to a hearing held by Congress’s Joint Economic Committee on the American Community Survey (ACS) and the Economic Census. AGC uses information from both sources in state fact sheets that show the role of construction in the economy and the share of small business in each state’s construction industry. I was invited as AGC’s chief economist and as the 2011-12 vice president of the National Association for Business Economics, the professional organization for people who use economic information in their workplace. The ACS is a questionnaire that the Census Bureau sends each month to a small but scientifically selected random sample of households. The ACS replaced the “long form” of the decennial census and provides much more timely information with greater accuracy and lower cost. The Economic Census, which the Census Bureau has conducted every five years for decades, covers the full range of industries with sector-specific questionnaires and provides a benchmark on the scope of each industry that is the basis for many other statistics. The House voted in May, in a floor amendment to the FY 2013 Commerce Department appropriations bill, to repeal the penalty for not answering ACS questions, eliminate funding for the ACS and cut funding needed to conduct the census scheduled for early 2013. Sponsors of the amendments asserted the cuts would save money in FY 2013, eliminate duplication of information that could be provided by the private sector, and end coercive federal snooping into personal information. I testified that the value to a wide range of business, research and governmental users of the information far outweighed the budgetary cost. Making responses voluntary would greatly reduce the accuracy and/or timeliness of the information produced and would require greater expenditure to achieve adequate coverage or replace the data. Private data suppliers regarding construction starts cover only about half the spending reported by the Census Bureau. Elimination in recent years of a Census survey on residential improvements led to a loss of accuracy, not to replacement by an private data producer. The Senate has not acted on its version of the 2013 Commerce appropriations bill. Even if the Senate does not adopt the restrictions approved by the House, the outcome is likely to depend on what is included in an end-of-year omnibus bill covering many agencies. Provisions such as these may be retained unless Senators and Representatives hear opposition from constituents. For more about the benefit of the ACS and Economic Census to construction, talking points and a sample letter to Congress, contact Ken Simonson, simonsonk@agc.org or 703-837-5313.