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Abstract:
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In April 2020, the Bureau of Labor Statistics (BLS) introduced a new satellite series of inputs to industry price indexes. A limitation of the current input indexes is that they exclude imported inputs. The new indexes measure price change for both domestically produced and imported inputs for most 3-digit North American Industrial Classification System (NAICS) industries. To construct the indexes, BLS Producer Price Index (PPI) data and Import Price Index (MPI) data are combined. PPI data is used to measure price change for domestically produced industry inputs and MPI data is used to measure price change for imported industry inputs. This paper describes the methodology used to construct the satellite series, the publication structure of the indexes, and provides examples of potential uses for the new data. Potential uses include contract escalation, comparing domestic versus imported price trends for an industry’s inputs, studying price transmission between input and output prices for an industry, and revenue deflation. BLS will vet this series for about a year, conduct outreach, and collect feedback before determining whether it can be considered regular production data.
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