U.S. Adds Service Sector to Tracked Data; First New Economic Indicator in 40 Years
Byline: Jeffrey Sparshott, THE WASHINGTON TIMES
The Bush administration next week plans to release newly created data on the service sector, the first new economic indicator from the U.S. Census Bureau in almost 40 years.
Service companies produce the bulk of the nation's output but are poorly measured in government economic data. The new quarterly survey will measure revenue from telecommunications, software publishing, employment services, media and other service industries, the Commerce Department said yesterday.
"This is the first step on the road to building much better information on the service sector of our economy," said Kathleen Cooper, commerce undersecretary for economic affairs..
Service industries measured by the new census survey account for almost 55 percent of U.S. economic activity. If retail, wholesale and government are included, services account for 80 percent of gross domestic product.
The Bureau of Economic Analysis, which uses slightly different data to track services, said the sector accounted for 43 percent of economic output 40 years ago. Services first passed 50 percent of economic output in 1983, and in 2003 represented almost $6.4 trillion of the United States' $11 trillion in gross domestic product.
But data collection has not kept up with the growing importance of the sector. Services information had been available only in annual and five-year surveys, a pace too slow to help companies adjust in a rapidly shifting economy, Commerce Department officials said.
"It's certainly the case that we don't have very good data for the service sector," said Charles McMillion, president of MBG Information Services, a D.C. analysis and forecasting firm.
The Coalition of Service Industries, a D.C. trade group, said the figures would help create a clearer picture of the role services play in the economy.
The companies are especially sensitive to ups and downs in the business cycle, so the information is valuable for tracking industry trends, making production and hiring decisions, and determining immediate corporate strategies. …