New Institute Provides Modern Insights into Economy, Labor Market
Traditional approaches to measuring economic activity are threatened by some serious challenges, including declining survey response rates, a growing share of output in hard-to-measure sectors, and changes in the way that work is organized. A new institute co-directed by faculty at the University of Maryland and the University of Michigan recently launched with the goal of modernizing the nation’s economic statistics.
This work is especially vital, as businesses, governments and households all rely on the economic data produced by the federal statistical agencies, making it critical to ensure that the data are as accurate as possible.
Distinguished University Professor of Economics Katharine Abraham co-directs the new Economic Measurement Research Institute (EMRI), which will promote research on the measurement of prices, output, labor market outcomes, technology, and more.
EMRI’s aim is to show how naturally-occurring data created by households, businesses, and government in the course of their ordinary activities can be leveraged to reengineer official economic statistics. The research will produce new methods for capturing how fundamental changes in technologies affect economic outcomes for households and businesses, and how technological change affects the structure of the economy and its overall performance.
The EMRI is funded by a three-year, $7 million award from the National Science Foundation, with additional support from the Alfred P. Sloan Foundation. It will be housed at the National Bureau of Economic Research.
Abraham’s co-director is Matthew D. Shapiro, the Lawrence R. Klein Collegiate Professor of Economics at the University of Michigan.
“The world has changed enormously since the existing methods for producing economic statistics were designed. We will be working together with the staff of the federal statistical agencies to move those methods into the 21st century,” Abraham said.
As an example of this work, Abraham cited efforts to modernize the production of statistics on retail purchases. An EMRI-supported research team that includes Distinguished University Professor John Haltiwanger, Census Bureau Deputy Director Ron Jarmin, Shapiro and others is developing methods for using the wealth of information that retailers collect electronically to replace sales and price statistics constructed by surveying retail businesses.
In another EMRI-supported project, Abraham will be working with two academic collaborators and Census Bureau staff to develop new information about the gig economy.
“By linking information on the earnings of non-W2 workers to information on the characteristics of those workers and their households, we’ll be able to develop a clearer understanding of who these gig workers are and how their earnings contribute to household incomes. Having a regular set of gig economy statistics would add a lot to our understanding of how the labor market is evolving,” Abraham said.
Abraham noted that there is a lot more that the statistical agencies could do to exploit information already stored in electronic form, possibly in combination with existing survey data, to produce richer and more accurate labor market statistics.
“For example, data from payroll providers could help the Bureau of Labor Statistics [BLS] produce more robust monthly payroll employment numbers. And the information contained in online job postings could allow the BLS not only to track how many jobs employers are trying to fill but also to tell a richer story about the skills required to fill those jobs and how the demand for different skill sets is changing,” Abraham said. “That sort of data could be invaluable for understanding how AI is affecting the labor market.”
Work on other EMRI projects is underway, and the EMRI will be opening calls for additional proposals to use new data sources to improve economic statistics or fill gaps in available statistics.
The EMRI also will host annual research conferences to foster collaborations targeting these objectives.
“Both through work we support directly, and through fostering other projects, our goal is for the EMRI to help with moving U.S. economic statistics forward,” Abraham said. “I think we have a real opportunity to create the impetus for some significant changes.”
Main image via iStock
Published on Mon, Dec 8, 2025 - 1:50PM