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The real-time data crisis
The coronavirus pandemic and the lockdown restrictions have obviously had devastating effects on the economy. But just as inadequate testing has hampered our ability to fully understand the spread of COVID-19, so has inadequate economic data hampered our ability to fully wrap our minds around the true scope of the collateral financial damage of the pandemic—and to figure out exactly how to address it. As Shawn Donnan writes for Bloomberg News in a post headlined “America Needs Real-Time Economic Data to Get Through This Crisis” (subhead: “The country has put its faith in statistics. But the numbers are failing it this time”),
From around the country, there have been reports of websites crashing and hotlines ringing busy, as state agencies struggled to cope with the historic deluge of people filing for unemployment benefits. Also, in states including Massachusetts and Oregon, whole segments of the labor force—the self-employed and gig workers—have been told to not file their claims for the time being.
Concerns over the quality of the jobs statistics prompted a group of Federal Reserve Board economists to construct their own employment index using data from payroll services provider ADP LLC, which can churn out daily stats covering 20 percent of U.S. companies. By its calculations the U.S. lost a net 13 million jobs in the final two weeks of March alone. Yet it also admitted that if a different methodology were used, the job losses would have been as high as 23 million.
That’s useful context as you take in today’s headlines—such as this one from the Financial Times: “US jobless claims of 4.4m take pandemic toll to a record 26m.”
Given that it’s increasingly obvious that official statistics on things such as unemployment are lagging reality by weeks or months (and many millions), how are economists and other experts coping with such incomplete data? Donnan suggests that in some cases they’re just ... not:
The unprecedented speed and scale of this recession makes it almost impossible for forecasters to tell us how bad it’s going to get. Some have given up. The Philadelphia Federal Reserve Bank recently suspended publication of its state-level leading economic indices indefinitely because the “extreme impact” of the COVID-19-related job losses had made the exercises unreliable for predicting the next six months, which is what they are designed to do.
Keep reading here.
Are you ready for a bright spot? Here’s one: “Snapchat reported its advertising revenue hit $462 million in the first quarter—a 44 percent year-over-year increase that impressed Wall Street—and the company gave a sense of how advertising is still growing, even if at a slower rate, through the coronavirus pandemic,” Ad Age’s Garett Sloane reports.
More good news
Continuing on with our need-for-real-time-data theme, we’ve got some compelling figures to share from Commerce Signals, a Verisk Financial company that’s in the business of analyzing anonymized U.S. consumer credit and debit spending behavior across a 40-million-household dataset.
Everything you’d expect to be doing really badly—travel, restaurants, hospitality—is doing really badly. But here are four bright spots, per Commerce Signals:
• Grocery stores saw payment card sales climb by 28.8 percent during March, compared to a year earlier.
• Discount or mass merchant stores, including names like Walmart and Target, were up 16.3 percent.
• Hardware store card revenues were up 2.7 percent.
• Wholesale retail, which includes Club stores and Amazon, rose 11.7 percent.
Commerce Signals has also been monitoring the dramatic shift toward online purchasing during this time of self-quarantine. Per a white paper the company has prepared for its clients,
Online sales in these growing retail categories all increased faster than in-store payments. For example, in-store grocery sales were up 26.8 percent in March, compared to a year ago, while online grocery sales grew 64.5 percent in the same year-to-year comparison. In-store card payments to discount/mass merchant retailers climbed just 1.9 percent for March, but online payments jumped 62.7 percent. In the last week of March, in-store payments to discount/mass merchant retailers fell 24.8 percent compared to a year earlier, while payments for online sales climbed a whopping 121.3 percent.
Commerce Signals has launched a new product, a dashboard it calls the COVID-19 Consumer Spending Impact Tracker, for marketers and agencies that need a deeper, more granular dive into real-time consumer spending data.
Facebook this week launched a new interactive map in collaboration with Carnegie Mellon University that attempts to add insight to our understanding of the spread of COVID-19 in the U.S. (with a global map, still in development, soon to follow).
The simplest, best explanation of the Facebook & Carnegie Mellon University COVID-19 Symptom Map, from the project’s description: It “shows an estimated percentage of people with COVID-19 symptoms, not confirmed cases. ... Facebook uses aggregated public data from a survey conducted by Carnegie Mellon University Delphi Research Center.”
As Facebook and CMU further explain,
The survey from CMU Delphi Research Center asks people to self-report symptoms associated with COVID-19 or the flu that they or anyone in their household has experienced in the last 24 hours. Surveys like this have been used globally for public health research. Even with as few as several thousand responses, survey data like these have been successfully used to forecast the spread of the flu and other illnesses.
Facebook reaches large segments of the population allowing for a significant representation of age, gender and state of residence. Every day, a new sample of Facebook users over 18 years old within the United States are invited to participate in the survey. Facebook doesn’t receive, collect or store individual survey responses, and CMU doesn’t learn who took the survey.
Check it out here.
• “Amazon Scooped Up Data From Its Own Sellers to Launch Competing Products,” per The Wall Street Journal.
• “Microsoft embraces big data” (subhead “Once a walled garden, the world’s biggest tech firm wants to liberate digital information”), per The Economist.
This section of Datacenter Weekly is intended to highlight upcoming data-centric events, but we’ve paused that “community calendar” function as the coronavirus crisis has escalated. For now, we’re directing your attention to Ad Age’s Coronavirus Industry Event Tracker for details on canceled and rescheduled conferences and other get-togethers.
The newsletter is brought to you by Ad Age Datacenter, the industry’s most authoritative source of competitive intel and home to the Ad Age Leading National Advertisers, the Ad Age Agency Report: World’s Biggest Agency Companies and other exclusive data-driven reports. Access or subscribe to Ad Age Datacenter at AdAge.com/Datacenter.
Ad Age Datacenter is Kevin Brown, Bradley Johnson and Catherine Wolf.