What Happens to Jobs Report if Government Shuts Down?

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Federal bureaucrats are scrambling to determine which government functions should be deemed “essential” in the event of a partial government shutdown. Next week’s employment report seems to lie squarely on the chopping block.

If the government shutters nonessential operations on Tuesday, longstanding protocol appears to call for a delay in releasing the Oct. 4 jobs data. That’s what happened in 1995.

But it’s possible the jobs report could be spared. Keith Hall, a former commissioner of the Labor Department’s Bureau of Labor Statistics, said number crunchers this time could conceivably rush to release the market-moving figures before heading home during the budget standoff.

The survey that determines the unemployment rate has already been completed and analysts are now processing the numbers, Mr. Hall said in an interview.

“Once they collect data and compile it, they don’t want to hold on to it for security reasons,” said Mr. Hall, now a senior research fellow at George Mason University. A disorganized release of the figures could roil financial markets, especially because of the employment report’s importance to the future of the Federal Reserve’s bond-buying program.

If he were in his former post, Mr. Hall said he’d seek permission to complete work on the jobs report. The administration might allow it, but could require BLS to release the data as soon as possible, rather than require staff to stick around the remainder of the week, he said.

A similar scenario played out in 1995, according to a memo Mr. Hall sent to his superiors in 2011 when he was still at BLS.

In 1995, a monthly report on the consumer price index had been prepared, but the shutdown occurred before the figures were released. “The risk of disclosure of the CPI data during a shutdown was deemed to be unacceptable and releasing the CPI report was deemed to be part of the orderly cessation of activities,” the memo said.

The 1995 shutdown did result in the delayed release of reports on employment, gross domestic product and other data.

When the threat of a shutdown loomed in 2011, it was determined that BLS reports, including the jobs data, weren’t essential and therefore wouldn’t have been produced if the government closed.

The contingency is spelled out in the Labor Department’s agreement with media organizations, including Wall Street Journal publisher Dow Jones & Co., that participate in embargoed data releases known as lock-ups.

“In the event of a federal shutdown due to a lapse in appropriations, neither a lock-up nor Web posting should be expected to occur,” according to the March 1, 2013 version of the agreement.

Labor Department officials declined to immediately comment. A BLS spokeswoman said the agency is preparing for a “normal week.”

The Labor Department’s policies indicate that it will handle a shutdown due to lack of appropriations differently than other times the government is closed. For example, when inclement weather shuts the agency, lock-ups are canceled but “every effort” is made to release the data online.

Another piece of employment data, jobless claims, may well continue during a government shutdown. In 2011, the Labor Department determined it would continue to produce the weekly report because “this data is considered to be essential to the Federal Reserve Board in setting monetary policy, a critical function for the U.S. economy.”

Mr. Hall said continuing to report claims is somewhat easier because state agencies, which would not be affected by the shutdown, process most of the data.

The Oct. 1 construction spending and the Oct. 3 factory orders reports are among the first data that could affected by a shutdown. Both come from the Commerce Department. A spokeswoman said the department “is still in the process of updating our plans.”