CPS Nonresponse During the COVID-19 Pandemic
Explanations, Extent, and Effects
Published in: Labour Economics, Volume 72 (October 2021). doi: 10.1016/j.labeco.2021.102060
Posted on RAND.org on December 21, 2021
The COVID-19 pandemic significantly affected data collection for the nation's primary source of household-level labor force data, the Current Population Survey (CPS). In the first four months of the pandemic period (March–June 2020) the average month-over-month nonresponse rate increased by 58 percent, while the size of newly entering cohorts declined by 37 percent relative to the prior 15 months. Together, these factors reduced the overall sample size of the CPS by around 16 percent. We hypothesize that these changes, and significant associated shifts in the demographic composition of the sample, were caused by the cessation of in-person interviewing. Geographic variation in nonresponse over this period does not appear related to variation in COVID case rates across metro areas or states. Using this change in interview method as a natural experiment, we compare labor market outcomes of those who entered the survey before and after the start of the COVID pandemic and find that the change in how individuals were recruited into the survey affected estimates of unemployment and labor force participation. In an exercise generating a counterfactual group of "missing" respondents, we estimate that, between April and August of 2020, the average unemployment rate was 0.5 to 0.7 percentage points higher, and the labor force participation rate was 0.4 to 0.8 percentage points lower than estimates using the actual sample of respondents. One implication of these results is that web-based surveys, which are increasingly relied on in empirical labor market studies, may fail to reach important subpopulations of the labor market and that reweighting is unlikely to address the selection on outcomes we document.