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The recent U.S. federal government shutdown, furloughing nearly a million workers and halting most services deemed non-essential, also closed the Bureau of Labor Statistics, the nation’s principal fact-finding agency for labor economics and statistics.
On October 24, in the middle of the ongoing funding lapse, the agency will release one of its most critical reports: the Consumer Price Index, the country’s main measure of inflation.
This seemingly contradictory event is not a political concession or a simple change of plans. It is the result of a unique collision of law, political brinksmanship, and economic necessity, where one federal statute is forcing a temporary breach in the wall of a government-wide shutdown mandated by another.
The Legal Framework
The legal mechanism that forces the federal government to close its doors is a 19th-century law known as the Antideficiency Act. Its strict prohibitions, combined with agency-specific contingency plans, created the set of rules that initially forced the Bureau of Labor Statistics into a near-total operational halt.
The Antideficiency Act
First enacted in 1870 and subsequently amended, the Antideficiency Act makes it a federal crime for government officials to spend public money or enter into contracts before Congress has appropriated the funds to pay for them. The law is designed to enforce Congress’s constitutional “power of the purse.” Violations can result in administrative discipline, including removal from office, as well as criminal penalties such as fines and imprisonment. It is the force of this law that compels agency leaders to initiate an orderly shutdown of operations when a funding gap occurs.
The Act, however, is not absolute. It contains a few narrow exceptions that allow certain government functions to continue. The most well-known exception permits activities that are necessary for “the safety of human life or the protection of property”. This provision is what allows air traffic controllers, federal law enforcement, and other critical personnel to remain on the job during a shutdown.
Employee Categories During a Shutdown
During a shutdown, federal employees fall into one of three categories based on the nature of their work and its funding source:
Furloughed (or Non-Excepted): This is the largest group of employees. They are placed on a temporary, non-duty, non-pay status. They are legally prohibited from performing any work for the government, including checking emails or making work-related calls, until an appropriation is passed.
Excepted: These employees perform work that falls under one of the Antideficiency Act’s exceptions, such as protecting public safety or national security. They are required to report to work but do not receive their paychecks until after the shutdown ends.
Exempt: This is a smaller category of employees whose work is funded by a source other than the annual appropriations bills that have lapsed. This can include multi-year funding, trust funds, or user fees. These employees continue to work and be paid on their normal schedule. The U.S. Postal Service, which is self-funded, is a prominent example of an exempt entity.
The BLS Shut Down
In preparation for the funding lapse, every federal agency developed a detailed contingency plan outlining which functions would cease and which employees would be furloughed. The Department of Labor’s plan for the October 2025 shutdown was unequivocal in its treatment of the Bureau of Labor Statistics. The official plan stated: “BLS will suspend all operations. Economic data that are scheduled to be released during the lapse will not be released. All active data collection activities for BLS surveys will cease”.
This plan was executed immediately on October 1. All but one of the BLS’s 2,055 employees were furloughed. The DOL’s plan as a whole designated 76% of its total workforce, or 9,775 employees, for furlough. The immediate consequence of this decision was the indefinite postponement of the highly anticipated September jobs report, which had been scheduled for release on October 3, 2025.
This approach marked a significant departure from the 35-day partial shutdown of 2018-2019. During that event, the BLS had been pre-funded through its appropriations bill and continued to operate normally, releasing all economic data on schedule. The decision in 2025 to treat the nation’s core statistical agency as a non-essential function subject to a full shutdown represented a critical shift, making the planned exception for the CPI all the more extraordinary.
Why the CPI Cannot Wait
The reason the September CPI report cannot remain locked behind the shutdown’s closed doors lies not in its general economic importance, but in its specific, legally mandated role in a process that affects the financial well-being of more than 100 million Americans. The CPI is not just an economic indicator; it is a piece of critical legal infrastructure.
The Consumer Price Index
The CPI, produced monthly by the BLS, is the nation’s most widely used measure of inflation. It tracks the average change over time in the prices paid by urban consumers for a representative market basket of goods and services, from food and gasoline to rent and medical care. Its influence is vast. The Federal Reserve uses CPI trends to help formulate monetary policy and set interest rates. Businesses use it to make decisions about pricing, investment, and wages. The federal government uses it to adjust income tax brackets and to determine eligibility for a wide range of assistance programs.
The Social Security COLA
The single most direct and powerful application of the CPI is its legally mandated function in calculating the annual Cost-of-Living Adjustment for Social Security benefits. This annual adjustment is not a discretionary policy choice; it is required by federal law.
Section 215(i) of the Social Security Act specifies the precise formula that the Social Security Administration must use to determine the COLA each year. That formula is not based on a general assessment of inflation, but on a specific data series produced by the BLS: the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).
The law dictates that the COLA is determined by comparing the average CPI-W for the third quarter of the current year (the average of the July, August, and September index values) to the average for the third quarter of the last year in which a COLA became effective.
Furthermore, the Social Security Act creates a firm operational deadline. The SSA is required to announce the COLA for the upcoming year in October, allowing for the adjustments to take effect for benefits paid in January. This statutory requirement means that the SSA cannot fulfill its legal duty without the September CPI-W data from the BLS.
The Stakes
The timely and accurate calculation of the COLA is a matter of immense consequence. The adjustment directly affects the income of over 67 million Social Security beneficiaries and more than 41 million recipients of the Supplemental Nutrition Assistance Program, among other programs. In total, the CPI-driven COLA impacts the incomes of over 108 million people.
The need for precision is paramount. A former BLS Commissioner has noted that if the inflation rate used for the COLA is misestimated by just one-tenth of one percent, the federal government would either overpay or underpay beneficiaries by more than a billion dollars over the course of a single year.
The shutdown has thus created a direct conflict between two federal laws. The Antideficiency Act, as interpreted by the DOL’s contingency plan, mandated that the BLS cease its work. The Social Security Act, however, implicitly requires that work to continue to allow the SSA to “meet statutory deadlines necessary to ensure the accurate and timely payment of benefits”. It is this legal conflict that has forced the government’s hand.
How the CPI Will Be Released
Faced with a direct contradiction between federal statutes, the executive branch is utilizing a nuanced legal interpretation of the Antideficiency Act to authorize a temporary, partial reactivation of the Bureau of Labor Statistics for a single, critical task.
The Announcement
On October 10, 2025, ten days after the BLS went dark, the agency issued a surprising press release. It announced that the September 2025 CPI report, originally scheduled for October 15, would be published on Friday, October 24.
The announcement was explicit about the reason for this exception, stating that the release is necessary to allow “the Social Security Administration to meet statutory deadlines necessary to ensure the accurate and timely payment of benefits”. To underscore the limited nature of this action, the BLS was careful to add, “No other releases will be rescheduled or produced until the resumption of regular government services”. This confirmed that the jobs report and other key economic indicators will remain on hold indefinitely, but the CPI will be an exception.
The Legal Mechanism
To produce the report, the BLS will have to recall a small number of its furloughed employees. The legal authority for this action comes from guidance issued by the Office of Management and Budget on how to interpret the Antideficiency Act during a funding lapse.
While the most common exception to the Act is for activities protecting life and property, OMB guidance also allows for the continuation of functions that are “necessarily implied” by other legally authorized and funded activities. The logic is as follows: since Social Security benefit payments are a mandatory spending program with a permanent appropriation, they are not affected by the shutdown and must continue. Therefore, any administrative work that is an essential prerequisite for making those payments correctly is “necessarily implied” by law to continue as well.
This legal doctrine will serve as a relief valve, resolving the conflict between the two statutes. It allows the Department of Labor to re-designate the specific BLS economists, statisticians, and support staff needed to compile and publish the September CPI as “excepted” employees for this limited purpose. These employees will be legally recalled from furlough, will perform their duties without immediate pay, and will be placed back on furlough status once the CPI report is released.
Production Under Duress
A crucial element that is making this exceptional release possible is a matter of timing. The extensive data collection process for the September CPI—which involves BLS data collectors gathering approximately 100,000 price quotes from thousands of establishments across the country—was completed before the government shut down on October 1.
The work required of the recalled employees during the shutdown will be primarily data processing, statistical analysis, and the preparation and publication of the final report. Had the shutdown begun just one month earlier, it would have severely disrupted the data collection itself, likely making an accurate and timely report impossible to produce, even with this legal exception.
A Unique Precedent and Ongoing Crisis
The planned release of the September CPI during the October 2025 shutdown will set a new precedent in the history of government funding gaps. However, while this short-term solution will avert a crisis for the Social Security Administration, the prolonged shutdown is creating a much more significant and lasting crisis for the nation’s economic data infrastructure.
Historical Context
The handling of BLS data releases during the 2025 shutdown is unique when compared to previous major funding lapses.
| Shutdown Year(s) | Duration | BLS Funding Status | Jobs Report Status | CPI Report Status |
|---|---|---|---|---|
| 1995-1996 | 21 days | Lapsed | Data Collection Challenged | Data Collection Challenged |
| 2013 | 16 days | Lapsed | Delayed (Released Post-Shutdown) | Delayed (Released Post-Shutdown) |
| 2018-2019 | 35 days | Pre-funded | On Schedule | On Schedule |
| 2025 | Ongoing | Lapsed | Delayed Indefinitely | Will Be Released During Shutdown |
As the table illustrates, the 2025 event will be the first time the BLS, after being fully shut down due to a funding lapse, is partially reactivated during the shutdown to produce and release a specific report. In 2013, a similar situation resulted in all reports being delayed until after the government reopened. In 2018-2019, the BLS was unaffected because it had been pre-funded. The 2025 release will therefore be an unprecedented action, driven entirely by the non-negotiable statutory mandate of the Social Security COLA calculation.
The Data Blind Spot
While the release of the September CPI will provide a crucial, albeit delayed, snapshot of past inflation, the ongoing shutdown is creating a severe problem for the future: it is crippling the collection of data for the October reports.
The production of the CPI and jobs report relies on a massive, time-sensitive data collection effort each month. BLS data collectors conduct personal visits and telephone calls to thousands of retail establishments and households across the country to gather price and employment data. With these employees on furlough throughout the critical collection period in October, this work is not being done.
This gap in data collection will have lasting consequences. When the BLS is eventually able to produce the October CPI, it will be forced to rely more heavily on statistical imputation—using models to estimate the prices that could not be collected. This will inevitably degrade the quality and reliability of the data, creating what economists call a “break in the series”.
This is creating a dangerous “data blind spot” for the nation’s top economic policymakers. The Federal Reserve, which has repeatedly stated that its decisions on interest rates are “data-dependent,” will be forced to make critical judgments about the health of the economy with impaired vision. By allowing the shutdown to persist, the government is effectively trading a clear picture of the past (the September CPI) for a blurry and untrustworthy picture of the present and future. The temporary solution to the COLA problem is creating a much larger, long-term problem for the sound management of the U.S. economy, illustrating one of the most profound and often overlooked costs of a government shutdown.
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