Strategic Objective 1.3

Performance Outcome: Meet the needs of policymakers, businesses, non-profit organizations, and the public for current and benchmark measures of the U.S. population, economy, and governments (ESA/Census)

The Census Bureau collects and disseminates a wide range of current demographic and economic information and provides benchmark measures of the Nation’s economy and population to help decisionmakers and the public make informed decisions.

The Census Bureau’s current economic statistics program provides public and private data users with monthly, quarterly, and annual national statistical profiles of the U.S. economy. Agencies, like the Federal Reserve Board and BEA are two of the major users of these data. These data are used to develop the GDP, production indexes, and Congressional economic projections. Also, these data allow users to gauge competition, calculate operating ratios, analyze changes in the Nation’s economic structure, calculate market share, locate business markets, and design sales territories.

In FY 2007, the Census Bureau released more than 400 economic reports, including 124 principal economic indicators, providing information on retail and wholesale trade and selected service industries, construction activity, quantity and value of industrial output, capital expenditure information, e-commerce sales, foreign trade, and state and local government activities.

The current demographic statistics programs provide accurate, timely, and efficient information on the social and economic condition of the population. These programs include:

• The Current Population Survey (CPS) provides the official source of monthly labor force estimates, quarterly housing vacancy estimates, and annual estimates of work experience, income, poverty, migration, and school enrollment. In January 2007, the questionnaire instrument software for the core labor force questions and all the monthly supplements was successfully upgraded to a Windows-based version.
• The Survey of Income and Program Participation (SIPP) is the major source of information on the economic well being of Americans over time. The data are used to estimate future costs and coverage for government programs and to provide detailed statistics on the distribution and source of income in the United States. The Census Bureau also continued efforts to improve its statistical methods to collect information on economic well being so that the data collection and processing systems on income and federal and state program dynamics better meet the policy and operational needs of the country. In FY 2007, the Department began work to evaluate the following:
  • Use of administrative records data to evaluate and improve data quality;
  • Improvements in the instrument and processing system;
  • Use of the American Community Survey (ACS) for the sampling frame;
  • Use of the event history calendar to improve recall;
  • The review and revision/update of content.

The Survey of Program Dynamics (SPD) provides sub-national estimates of poverty and receipt of government assistance; and the State Children’s Health Insurance Program (SCHIP) provides state-based estimates of health insurance coverage of children.

The Census Bureau met its targets to achieve at least 90 percent of the planned response rates and dissemination targets for Census Bureau surveys. Response rates are a measure of the quality of survey data. Dissemination targets are a measure of timeliness of the data. By meeting these targets the Bureau is providing its users with the high quality and timely data they need to make important policy decisions that help improve the Nation’s social and economic conditions.

The Census Bureau’s cyclical programs provide the foundation for critical national, state, and local data. These include the Economic Census and Census of Governments, which are conducted every five years, and the Decennial Census program.

The Economic Census provides comprehensive, detailed, and authoritative facts about the structure of the U.S. economy ranging from the national to the local level. The 2007 Economic Census will cover some 26 million business locations and 84 percent of the Nation’s economic activity. The data help build the foundation for GDP and other indicators of economic performance.

During FY 2007, the Census Bureau completed critical preparations for the 2007 Economic Census data collection and processing, which will begin in October 2007 and continue throughout FY 2008. Key accomplishments for FY 2007 include:

• Collection Instrument Preparation. The Bureau completed paper and electronic versions of more than 530 industry-specific collection instruments, building on work done during FY 2006 to determine content and assemble questionnaires.
• Business Outreach. The Bureau began business outreach activities in advance of Economic Census data collection in order to build good reporting relationships with companies and to promote timely response.
• Frame Preparation. The Bureau also completed important activities during FY 2007 to prepare the Economic Census mailing list, including an effort to improve industry classifications on its Business Register, which is important for determining which of 530-plus industry-specific questionnaires is mailed to each establishment.
• Processing System Preparation. The Bureau also prepared computer applications for the Economic Census data collection and processing, ensuring that systems needed for mail selection and mailout operations were ready for production by September 2007.

The Census of Governments is the only source of comprehensive and uniformly classified data on the economic activities of state and local governments. The 2007 Census of Governments, the eleventh since its inception in 1957, will cover about 90,000 local governments, including thousands of subordinate agencies. This complex and ever-changing government universe is a major economic factor totaling 12 percent of GDP and nearly 16 percent of the U.S. workforce. During FY 2007, the Census Bureau made critical preparations for 2007 Census of Governments data collection and processing, which began in FY 2007 and continue throughout FY 2008.

The Intercensal Demographic Estimates program provides updated estimates of the U.S. population for the country, states, counties, cities, and townships in the years between the decennial censuses. This year was the first official set of population estimates that included the effects of Hurricanes Katrina and Rita. Special processing was done that supplemented the usual Internal Revenue Service (IRS) data with data from the National Change of Address File from the U.S. Postal Service. In addition to meeting the schedule for the release of the official set of July 2006 population estimates for the nation, states, counties, cities and townships, the Intercensal Demographic Estimates program has been working on a research agenda to look at the housing unit based estimates methodology. This research agenda developed out of the population estimates stakeholders meeting held in July 2006. At this meeting, stakeholders asked the Bureau to look at alternative population estimates methodologies, such as the housing unit based approach, and to also examine alternative data sets.

The Demographic Surveys Sample Redesign (DSSR) program provides updated samples for most major recurring household surveys conducted by the Census Bureau to account for changes in the population and demographics, survey requirements and objectives, and survey methods and technology. The Census Bureau completed memorandums of understanding (MOU) with survey sponsoring agencies that enable the Census Bureau to ensure that the 2010 Sample Redesign meets sponsors’ needs and provides accurate and reliable data for policymakers, business, and the U.S. public. The Bureau completed several studies in the development of a coverage profile of the Master Address File (MAF), a potential single sampling frame that could reduce survey costs. The Census Bureau also discussed its sample redesign program with the statistical community, including professionals from Statistics Canada and academia, which served as a peer review of redesign methods and as an opportunity to learn new ideas to improve accuracy or reduce costs.

The decennial census is used to provide the official population counts for determining the allocation to states of seats in the U.S. House of Representatives and for determining how the districts are defined for those seats. The Census Bureau provides to each state the data necessary to determine Congressional, state, and local legislative boundaries. The decennial census provides comprehensive and useful demographic information about all people living in the United States, Puerto Rico, and the associated Island Areas. The program also provides data for small geographic areas and population groups that federal agencies need to implement legally mandated programs. Approximately $300 billion a year is distributed to state and local governments using formulas that are based on data such as state population and personal income.

Working towards these outcomes in FY 2007, the decennial census program began conducting the early operations for the 2008 Census Dress Rehearsal as well as awarded contracts for printing and the integrated communications program for the 2010 Census itself. The ACS, which collects and tabulates long-form data every year throughout the decade, achieved a 97.8 percent weighted response rate, using three modes of data collection (mail-out, telephone, and personal interview). The ACS also released social and demographic data for all places with a population of 65,000 and larger for the second year in a row. The Boundary and Annexation Survey (BAS) program achieved an 87.5 percent response rate. BAS is used to update information about the legal boundaries and names of all governmental units in the United States. In addition, street features have been corrected in the Topologically Integrated Geographic Encoding and Referencing System (TIGER) database for 737 counties in FY 2007, bringing the total completed to 90 percent of all 3,232 counties in the United States and Puerto Rico.

The data used to evaluate the effectiveness of performance goal achievements are reviewed on a quarterly basis. The Census Bureau continues to validate the performance data and ensure that all programs have verifiable processes in place to collect, store, and calculate all performance information reported in the Annual Performance Plan (APP) and the Performance and Accountability Report (PAR).

Performance Outcome: Promote a better understanding of the U.S. economy by providing the most timely, relevant, and accurate economic data in an objective and cost-effective manner (ESA/BEA)

ESA’s BEA produces some of the Nation’s most important and closely-watched economic statistics, including the GDP, the broadest measure of economic activity. BEA produces economic statistics for three major program areas: National Economic Accounts, Industry Economic Accounts, and Regional Economic Accounts. Greater descriptions of these accounts can be found on the BEA Web site at www.bea.gov.

BEA draws on the data collection and analyses conducted by the Census Bureau, Bureau of Labor Statistics (BLS), IRS, Federal Reserve, and others to produce over 50 public releases of economic statistics a year. Using these data, BEA estimates the Nation’s economic accounts. These estimates provide a comprehensive, integrated, and consistent measure of U.S. economic activity and are used as critical ingredients in budget appropriations and forecasts, international trade and policy formulation, and business and personal financial strategies. Without these measures, the Nation’s leaders would have little objective information on which to base monetary and fiscal policy decisions, and the domestic and global markets would have few statistics with which to understand the health of the U.S. economy.

Most of BEA’s customers are other government and business organizations that use the data BEA produces to make important decisions that affect the entire Nation. Measures such as the GDP, U.S. and local area personal income, international trade in goods and services, GDP by state, and GDP by metropolitan area are important components of the work of government, business, academia, and other organizations. Some key uses of BEA measures include:

• OMB, the Congressional Budget Office, the Council of Economic Advisors, and the Department of Treasury use BEA’s GDP estimates and a wide range of other National Income and Product Accounts (NIPA) data, including trend growth in real GDP and inflation, wages and salaries, profits, and other types of data, to make important policy decisions.
• The Federal Reserve uses real GDP and BEA’s measures of inflation to establish monetary policy.
• U.S. businesses use BEA data to guide over $2 trillion of investment in factories, equipment, and new housing construction; to assess the macroeconomic and international trade outlook; and in making business location decisions in the United States and around the world.
• Federal programs—such as Medicaid, Foster Care, and SCHIP—use BEA’s regional income and product accounts as a basis to allocate over $214 billion in federal funds to states.
• Virtually all 50 states and the District of Columbia use quarterly state personal income to estimate revenue and expenditure projections. Twenty-one states have set constitutional or statutory limits on state government spending that are tied to components of state personal income.
• U.S. trade policy officials use trade and other international account statistics to develop trade policy and to assess the impact of international investment and trade on the U.S. economy.
• U.S. private investors use BEA’s economic data to help them manage over $22 trillion in investments in stocks and bonds.

BEA has worked to make these critical measures more accurate and more accessible for all users. Great progress has been made in recent years to accelerate the release of BEA’s key economic statistics and to expand the level of detail of both new and historical data available. Additionally, BEA has continued to upgrade its electronic survey data collection system, reducing respondent burden and decreasing reporting errors in data collection.

BEA has modernized its statistical processing systems and has made great progress in addressing the significant long and near-term challenges that the organization faces. During FY 2007, BEA achieved a number of important data improvement and availability targets, including:

• Introduced new and comprehensive estimates of international transactions and positions in financial derivatives.
• Substantially integrated the NIPA estimates with the Federal Reserve’s flow of funds accounts.
• Released prototype estimates of GDP by metropolitan area.
• Expanded the prototype research and development (R&D) accounts to include international transactions.
• Developed and published detailed FDI data on employment; payroll; and sales by state, industry, and country.
• Improved estimates of consumer spending in the economy.
• Launched an online, interactive mapping system for state and local area personal income.
• Unveiled a redesigned Web site to improve consistency and to enhance the look and feel in order to make BEA’s economic statistics even more accessible and easy to use.

BEA programs are evaluated through a variety of means. OMB has evaluated BEA twice using the Program Assessment Rating Tool (PART). In FY 2002 and FY 2003, BEA was awarded the highest rating of effective and was ranked within the top five percent of all federal programs reviewed. BEA also conducts an online survey of its data users to monitor their satisfaction with BEA products and services. For the past five years, customers of BEA products and services have indicated high levels of satisfaction. Every two years, BEA conducts an internal Organizational Assessment Survey (OAS), administered by the Office of Personnel Management (OPM), to assess its organizational culture. The results of the most recent OAS placed BEA above the median score compared to other agencies that participate in the OAS on every dimension. BEA also matched or bettered the highest ratings on over 40 percent of the assessment measures.

STRATEGIES AND FUTURE PLANS

The U.S. Census Bureau is using hand-held computers to update the address list for the 2008 Census Dress Rehearsal. Locally hired census workers will visit every housing unit to make sure it is on the Census Bureau’s address list and will receive a census dress rehearsal questionnaire in March 2008.

The Census Bureau strives to provide accurate, timely, and useful information to users in the most cost-effective manner while honoring privacy, protecting confidentiality, and conducting work openly. One way the Census Bureau is doing that is through a multi-year effort to re-engineer the census. This effort allows the Census Bureau to meet the Nation’s ever-expanding needs for social, demographic, and geographic information by improving the relevance and timeliness of census long-form data, reducing operational risk, improving accuracy of census coverage, and containing costs. The strategy is to accomplish that through the use of the ACS, enhancements to the MAF/TIGER database, and a re-engineered short-form only 2010 census. The Census Bureau will continue the ACS and release products for geographic areas and population groups of 20,000 or greater for the first time in FY 2008.

Other plans for FY 2008 include continuing major contracting efforts related to field data collection automation, data response integration, data access and dissemination, printing for the 2010 Census, and communications; conducting major data collection efforts for the 2008 Dress Rehearsal; continuing the overall management and integration of planning, testing, development and implementation efforts for the 2010 Census; and continuing to conduct early operations for the 2010 Census, including the opening of the Regional Census Centers.

The Census Bureau began efforts in FY 2006 to re-engineer the SIPP. SIPP’s household longitudinal design, with an interview every four months across several years, provides a wide breadth of detail on a wide range of topics, but is extremely burdensome on respondents, complicated to edit and process, and expensive to conduct. The Census Bureau is working with stakeholders and moving rapidly to develop an improved system and is considering several design options. It is hoped that the improved system will lower attrition, reduce respondent burden, and increase the timeliness of the data, while addressing the same basic issues historically covered by SIPP.

Census Bureau economic benchmark data are the foundation of the Nation’s economic statistics programs. They provide core information on virtually all non-farm businesses and related data on business expenditures, commodity flows, minority and women-owned businesses, and other topics. The Census Bureau plans to enhance the 2007 Economic Census to ensure the usefulness and relevance of the programs; expand content to include first-time collection of data on employers contributions for pension and health care and new data on service products; improve the timeliness of respondents, especially for large companies; increase response rates; improve internal processing efficiency; and improve the timeliness of statistical products.

In August 2007, the Committee on National Statistics completed its independent review of the Government Statistics programs and reported the results to the Census Bureau. The report included recommendations that covered:

• How the program can address its dual missions: reporting on the size and scope of the state and local government sector at an aggregate level, and reporting on the functions of individual governments.
• How to address inherent quality and cost-benefit trade-off issues when complex reporting arrangements constrain the program’s ability to change content, add new content, and assess quality control of the data.
• Dealing with high rates of nonresponse; the use of third-party data, editing, and imputation; and the possible applicability of procedures that other statistical agencies use.
• Improving the timeliness of information release and making it more accessible.

BEA continued to be proactive in 2007 with outreach to its user communities. As part of the annual updates to the BEA 5-year Strategic Plan, BEA provides all of its stakeholders and users an opportunity to review the 5-year plan and make recommendations. In addition, BEA senior staff have participated in conferences and meetings around the country and around the globe to share the Agency’s priorities and improvements. These face-to-face meetings provide an effective means of communicating enhancements to BEA’s accounts and of soliciting meaningful feedback.

During 2007, BEA expanded external communications and outreach efforts to inform existing users of upgrades and changes to BEA data, and to educate new users on how they can use BEA data to make better-informed decisions. Areas of particular focus for BEA’s FY 2007 outreach included communities affected by the Department of Defense’s (DOD) Base Realignment and Closure Commission (BRAC). BEA staff provided economic data to many of the 250 communities affected by the 2005 BRAC process. These data were useful to the affected communities in determining the potential economic impacts of the closure, expansion, and contraction of military bases nationwide. In addition, BEA worked closely with data users in California, Colorado, Georgia, Montana, Nevada, Pennsylvania, and Washington to introduce BEA’s statistics to new data users, and to help them explore the many uses of these economic statistics.

BEA’s outreach expands beyond the United States to include the international community. The Agency regularly attends meetings at the Organization for Economic Co-operation and Development to explain BEA’s economic measures and methodologies to the 30-nation membership to achieve greater comparability among the world’s economic statistics. BEA also regularly represents the Department at meetings with other international statistical officials, including the United Nations Statistics Division, to further develop common standards that promote the integration of official statistics worldwide.

BEA staff uses these and other outreach opportunities to understand the needs of users, which are then discussed and considered during the annual revision of the BEA 5-year Strategic Plan. This plan is updated each year through a series of BEA directorate-level planning retreats and a senior staff retreat. At the retreats, BEA staff reviews the past Strategic Plan and prepares a public report of the progress toward meeting the milestones. Through this process, BEA is able to clearly define a path that reflects the needs and interests of the U.S. public.

The BEA 5-year Strategic Plan is the most important tool the Agency employs to chart the course of the future and to evaluate all aspects of performance. The milestones of the Strategic Plan feed directly into the performance measures and budget requests of the Agency. In order to assure that these milestones are met, each of BEA’s employees is held accountable for completing components of the Strategic Plan.

Twice a year, the blue-ribbon 13-member BEA Advisory Committee meets publicly to review and evaluate BEA statistics and programs. The committee advises BEA’s Director on matters related to the development and improvement of the national, regional, industry, and international economic accounts, especially in areas of new and rapidly-growing economic activities arising from innovative and advancing technologies. The committee contributes significantly to BEA by providing recommendations for cutting-edge improvements from the perspectives of the economics profession, business, and government.

CHALLENGES FOR THE FUTURE

Given the major changes in overall design and methodology, the efforts involved with re-engineering the 2010 Decennial Census program will continue to present a significant management challenge for the Census Bureau and the Department.

The Census Bureau continues to address the significant management challenges of meeting user demands for reliable data, obtaining and maintaining targeted response rates for the various surveys conducted, and continuing to maintain respondent confidentiality.

BEA continues to face three major challenges in the near future. To tackle them, BEA has developed a detailed, public plan in its Strategic Plan for FY 2007 - FY 2011. The three major challenges facing BEA are:

Measuring a constantly changing economy. The U.S. economy is in constant flux. In order to measure an ever-changing economy, BEA must meet important challenges, such as understanding the structural changes in the economy, improving measurement methodologies in areas like R&D and healthcare, monitoring changing tax and accounting laws, and locating and incorporating data sources to capture these changes. BEA must continue to keep pace with the dynamic U.S. economy in order to provide the Nation with the most timely, relevant, and accurate economic statistics possible.

Integrating federal economic accounts. The demand for greater consistency between the various economic accounts in a decentralized statistical system continues to be an important issue among users of federal economic statistics. BEA made strides in its integration efforts between its industry accounts and the NIPAs, and is working with BLS and the Federal Reserve to integrate shared accounts. The federal agencies responsible for the production of U.S. economic accounts must continue working together to integrate the accounts by harmonizing definitions, methodologies, and analytical techniques in order to provide consistent estimates to users.

Building and developing a skilled workforce. BEA recognizes that its employees are its most valuable asset. Their ability to innovate and promote the country’s economic accounts in an objective and cost-effective manner is paramount. To that end, BEA has built competency models to manage the development of employees. These competency models highlight skills and talents that employees must possess and exhibit in all stages of their development at BEA. The competency models allow BEA to build a Workforce Development Framework that is directly tied to BEA’s mission and priorities. This framework provides transparency to its employees and guides the mission and objectives of its entire Workforce Development Program. BEA recognizes that a highly-skilled workforce produces results and adds value to its vital economic statistics.