PPI Needs your help handout

OMB No. 1220-0008

Bureau of Labor Statistics (BLS)

Producer Price Index (PPI)
www.bls.gov

BLS Needs Your Help
Your company is being asked to provide a small amount of pricing information to one of the principal statistical
agencies of the Federal Government. Your data will be used to construct the Producer Price Index.

What is the Producer Price Index (PPI)?
The PPI, one of the Nation’s Principal Federal Economic Indicators, is a family of indexes that measures the
average change in selling prices received by domestic producers of goods and services in over 500 industries.
More than 10,000 indexes for individual products and services are released each month, including over 600
indexes measuring price change for products sold to final demand and intermediate demand. Indexes are
available for the products of virtually every industry in the mining and manufacturing sectors, as well as many
industries in the service and construction sectors of the U.S. economy.

How does the PPI impact and benefit you?
Producer price indexes are widely used by the government and businesses to make better-informed business
decisions. Some valuable uses are:

For contract adjustment — The PPI can be used in purchase and sales contracts; for instance, a builder
may use the index for steel in their construction contract to effectively hedge against input price changes.

To track specific products and industries — Businesses use PPI data to compare price trends for their
production to price trends in their industry.

Forecasting — Businesses use past price trends to
forecast future price movement when creating business
plans and to understand national economic conditions.

To measure inflation — Indexes can be used to measure
price changes in inputs incurred by producers of goods and
services. This information is useful for businesses in
determining pricing strategy.

As an economic indicator — The Federal Reserve,
Congress, and Federal agencies regularly monitor the PPI
when formulating fiscal and monetary policies, such as
setting interest rates for consumers and businesses.
Also, indexes can be used to deflate other economic series to get inflation-free values.

For inventory valuation — The Internal Revenue Service (IRS) has mandated that the PPI be used for “Last
In, First Out” (LIFO) inventory valuation purposes.

OMB No. 1220-0008

Why should you participate?
You count! The quality of data produced by the U.S. Bureau of Labor Statistics (BLS) is a direct reflection of the
number of businesses included. The PPI carefully constructs survey samples to keep the number of contacts to a
minimum, making every business, large and small, critical to the accuracy of the data. The Nation depends upon
BLS for accurate statistics, and BLS relies upon people like you to provide us with data.

How do you provide data to the PPI?
A BLS economist will interview you to determine which products or services will be included in our indexes. You
will then be asked to provide periodic updates for the selected products or services. BLS uses these updates as
the basis for our PPI indexes. The update process is straightforward and will normally only take a few minutes to
complete.

Will your information be kept
confidential and secure?
Yes. Your company’s participation, including sampled
products and prices, will be held in confidence to the full
extent permitted by law. BLS will use the information you
provide for statistical purposes only, in accordance
with the Confidential Information Protection and Statistical
Efficiency Act (44 U.S.C. 3572). Your transmitted data is
protected from malicious activities through cybersecurity
screening of Federal information systems, in accordance
with the Cybersecurity Act of 2015.

For general information and analysis on the PPI, contact:
Producer Price Index
2 Massachusetts Avenue, NE.
Washington, DC 20212
(202) 691-7705
[email protected]
www.bls.gov/ppi
Respondent site:
www.bls.gov/respondents/ppi

OMB No. 1220-0008

How can BLS data help you?
In addition to the PPI, BLS produces a wealth of useful information that is free of charge. This includes:

Contract negotiations tools
During contract negotiations, BLS data may be used to ensure that prices reflect market costs over the term of
the contract. Contract adjustment guides are available on the BLS website.

Evaluating wage/benefits packages
Data from the BLS compensation programs show the average salaries for selected occupations, industries, and
localities. Information on the types and costs of employee benefit packages is also available.

Provide information on workplace injuries, illnesses, and fatalities
Worker compensation rates are partly determined by workplace injury rates. BLS data from the Occupational
Safety and Health program report the number of accidents and fatalities by specific occupation and industry.

Assessing growth industries, occupations, and career counseling tools
The BLS Occupational Outlook Handbook is a nationally recognized source of career information. This
publication is used by high school and college guidance counselors across the country. It provides information on
the training and education needed for specific career fields, and on earnings and job prospects for a variety of
careers. It also provides job search tips and specific information about the job market in each state.

To find out more:
Contact your regional BLS Economic Analysis and Information Office: www.bls.gov/bls/regnhome.htm
Atlanta
(404) 893-4222
[email protected]

Kansas City
(816) 285-7000
[email protected]

Boston
(617) 565-2327
[email protected]

New York
(646) 264-3600
[email protected]

Chicago
(312) 353-1880
[email protected]

Philadelphia
(215) 597-3282
[email protected]

Dallas
(972) 850-4800
[email protected]

San Francisco
(415) 625-2270
[email protected]