SERVICE METRICS FOR A SERVICE ECONOMY

Each time the government calculates the GDP, we may be receiving a skewed indicator.  This is because the government collects detailed information on products but less thorough data on services as Peter Coy explains (“Solving the Mystery of The Service Sector” Bloomberg Businessweek, 7/28/14–8/3/14, pp. 14–15):

Services account for 77 percent of private-sector output in the U.S.  There are only six principal economic indicators for services (including ones for construction and retail trade), vs. 17 for agriculture, construction, manufacturing, mining, and energy.” (p. 14)

How accurate that data is and exactly when it is released can convey very different results.  For example, the Bureau of Economic Analysis (Commerce Department) published data indicating a 9.9% annual increase in healthcare usage this year.  After refreshing its data and recalculating, it stated that the healthcare usage exhibited an annual decline of 1.4%.

These situations and other similar ones are prompting the BEA to reach out to the Census Bureau and other agencies to expedite and streamline its reporting processes.  The goal of course is more accurate and timely data.

Everyone makes mistakes.  That said, it is important to act quickly to revise procedures and reporting when you become aware that your data might be skewed.





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About James Meadows

Currently I serve as a training team manager for Johnson Controls at a customer-care center in Kansas City. Additionally, I am a business consultant, a freelance corporate writer, an Assembly of God ordained minister, a Civil Air Patrol chaplain, and a blogger. I believe we are living in the most fascinating times of human history. To maximize the opportunities these times present, I have a passionate interest in leadership development and organizational success, both of which I view as inextricably linked.

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