Key Government Data, Such as Unemployment and Inflation, Would Not be Published During a Shutdown

Absent legislation to fund the U.S. federal government, all non-essential staff compensated from discretionary funding will be furloughed. This includes the staffing needed to produce inflation data necessary to calculate the 2024 Social Security cost-of-living adjustment and other economic indicators key for investors and the Federal Reserve.

The Senate approved a measure on Tuesday by a vote of 77 to 19 to begin debate on a continuing resolution that would keep the government funded at current levels through November 17. If the Senate and the House of Representatives cannot agree on a continuing resolution, the government will shut down on Sunday, October 1, the start of the government’s next fiscal year.

According to the Department of Labor’s shutdown contingency plan, finalized Wednesday, the Bureau of Labor Statistics would furlough all employees.

There would therefore be nobody available to process and publish September employment and inflation data, due to be published on October 6 and October 12, respectively.

In the absence of September inflation data, the Social Security Administration would lack the data necessary to update the COLA for 2024, since the cost-of-living adjustment relies on inflation data from the third quarter, which includes September.

According to a DOL spokesperson, “In the event of a federal government shutdown, the Bureau of Labor Statistics will suspend data collection, processing and dissemination. Once funding is restored, BLS will resume normal operations and notify the public of any changes to the news release schedule on the BLS release calendar.”

The calculation of the COLA would be postponed until the BLS could resume normal operations. A continuing resolution would permit the BLS to continue operating, but negotiations between the parties and chambers have not produced a timeline for final floor votes.

Inflation and employment data are also key metrics for the Federal Reserve’s monetary policy. Other agencies, such as the Census Bureau and the Bureau of Economic Analysis, both organs of the Department of Commerce, would also be shuttered.

The Employee Benefit Security Administration would furlough 743 of its 908 employees. The 165 that would remain include essential employees not subject to furlough and those employed using other funding.

EBSA would only be empowered to bring enforcement actions if missing a statute of limitations is at stake or if human life is at stake, such as denial of medical benefits in life-threatening situations, according to the DOL’s contingency plan. EBSA can also continue to administer the Mental Health Parity and Addiction Equity Act and the No Surprises Act, both funded separately.

The Pension Benefit Guaranty Corporation would be unaffected by a government shutdown, including all customer service and support services. The PBGC is funded primarily through insurance premiums and therefore does not rely on the annual appropriations process.

SEC Chairman Gary Gensler said on Wednesday that the Securities and Exchange Commission would be unable to process new IPOs or take new enforcement actions if a federal government shutdown happens.