¶ … economic variables, pull data for as many years as possible and transform it into charts, explain each variable with a little background information and explain about what your variable measures and explain a bit about the history of your data. Explain what the data represents and cause and effects of increases and decreases.
Producer Price Index (PPI) Commodities.
The Producer Price Index (PPI) Commodities is the official measure of producer prices in the U.S. It is the instrument that measures the average changes in prices that producers receive for their labor.
Until 1978, the PPI was known as the Wholesale Price Index, or WPI. It is published by the Statistics and complied by the Federal Government and remains one of the oldest systems of statistical data. Its historical origin lies in the 1891 U.S. Senate resolution which authorized the Senate Committee on Finance to investigate the effects of the tariff laws "upon the imports and exports, the growth, development, production, and prices of agricultural and manufactured articles at home and abroad."(BLS Handbook of Methods)
The data itself is collected through a systematic sampling of producers in the manufacturing, mining, and service industries and this data is then published by the Bureau of Labor Statistics. Virtually every type of occupation in the mining and manufacturing categories are sampled and interviewed, and more are added all the time by the PPI. Confidentiality of the respondents is assured by the Confidential Information Protection and Statistical Efficiency Act of 2002 (Title 5 of Public Law 107-347) and this, to a great extent, encourages respondents to participate since response is voluntary.
The PPI categorizes its information according to three descriptions: industry, commodity, and stage of processing (SOP).
1. Industry -- the PPI measures the average change in prices received for an industry's output sold to another industry.
2. Commodity...
Stage of Processing - The PPI classifies commodities according to the class of buyer and the amount of processing or assembling that the products have undergone. There are finished goods which are ready for sale, as well as (a secondary commodity) intermediate materials that require further processing and, finally, crude materials that need to be worked on before being sold to the consumer.
The movement of the price changes form one month to another are expressed in percentage changes rather than as changes in index points. Price changes are measured from a reference point that equals 100.0. So for example the Excel sheet shows PPI for stage of processing of Finished Goods with base date being 1982 (which is the commonly accepted base period for most PPIs). The record itself was taken from the years of 1947-2002. January 2012 has the notation of 192.0 which can be read that there was an increase of 192% from the base period in the Finished Goods Price Index. In long hand, this will be read as the following:
"Prices received by domestic producers of a systematic sample of finished goods have risen from $100 in 1982 to $192 today."
The accompanying graph illustrates this rise in percentage growth of average changes in prices that producers received for their labor between the years 1947-2002.
Employment Cost Index
The employment cost index (ECI) is a quarterly economic series which records the changes in the cost of labor for businesses in the U.S.A. The ECI is prepared by the Bureau of Labor Statistics (BLS).
The ECI is often conflated with the consumer price index (CPI)] and indeed gets less attention that it, but it is really a different instrument. Whilst the CPI measures inflation in consumer prices, the ECI indicates whether labor expenses (or salaries / costs of hiring…
