Hurricane Katrina FAQ

Frequently Asked Questions (FAQs)
Effects of Hurricane Katrina on
Manufacturing and Trade Inventories and Sales (MTIS)
August 2005

This set of Frequently Asked Questions presents additional information on the Retail and Food Services Sales and Inventories estimates. For additional information on the other two components of the MTIS: Manufacturer’s Shipments, Inventories, and Orders (M3) or the Monthly Wholesale Trade Survey (MWTS), see the following links:

M3: http://www.census.gov/indicator/www/m3/faqs/FAQsKatrina.pdf

MWTS: http://www.census.gov/svsd/www/katrina.html

Can the Census Bureau estimate the effect of Hurricane Katrina on the sales and inventories estimates?

No. We cannot isolate the effect of Hurricane Katrina on the August 2005 retail sales and inventories as the Monthly Retail Trade and Food Services Survey (MRTS) measures retail activity on a national level and not at specific geographic areas.

The areas affected by the hurricane ordinarily account for a minimal percentage of total U.S. retail activity based on the 2002 Economic Census. Furthermore, the effect of Hurricane Katrina on retail activity at the national level for August would be much less since Hurricane Katrina only impacted the last few days of August.

Does the Census Bureau have monthly estimates of sales and inventories for the affected areas?

No. We cannot separately quantify the impact on the affected areas because the MRTS is designed to estimate for sales and inventories at the United States level only.

Was the Census Bureau able to collect information from firms operating within the affected areas?

Yes. We mailed sales questionnaires to 284 firms in Louisiana, Mississippi, and Alabama and 234 were able to provide data for August. In addition, we mailed inventories questionnaires to 57 firms in Louisiana, Mississippi, and Alabama and 51 were able to provide August end-of-month inventories.

Large companies with multiple locations are asked to report total U. S. sales and inventories for all retail locations, including locations in the affected areas. Most companies located in the affected areas had no difficulty reporting this month. MRTS accounts for missing data through its imputation procedure. This procedure makes use of data from companies that report both July and August data.

Yes. Our data collection staff asked additional questions with regard to the impact of Hurricane Katrina on sales and inventories as part of our regular follow-up.

No. The review of the seasonal adjustment output and diagnostics did not indicate that adjustments to the options were necessary for this month.

How did you represent the August end-of-month inventories for companies that had inventories damaged or destroyed as a result of Hurricane Katrina?

Companies report inventories based on their financial records. Any adjustments to reflect the effects of the hurricane (such as a write-down) will be included in our data when companies reflect it on their records. Our review of the data reported by companies for August shows no significant write-downs to end-of-month inventories. Based on discussions with over 300 respondents, fewer than 5% of companies indicated that they had inventories damaged or destroyed by Hurricane Katrina. Two reported small write-downs for August. Most of the rest expected a write-down would occur, but were uncertain as to when it would be reflected on their records.

What does the Census Bureau plan to do for estimates of retail trade and food services for September?

During our data collection we will continue to ask questions that will help us monitor any impact from Hurricanes Katrina and Rita as part of our regular follow-up. We will monitor data responses and make adjustments if necessary.