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Disclosure avoidance procedures

Like other statistical agencies, the Bureau of Economic Analysis (BEA) is legally required to safeguard the confidentiality of the information that it receives. In addition, like other agencies, it must balance its responsibility to avoid disclosing confidential information with its responsibility to release and to publish as much information as possible. It balances these responsibilities by presenting the estimates for regions, states, and local areas only at the Standard Industrial Classification (SIC) two-digit level or North American Industry Classification System (NAICS) subsector level, even though it receives source data at the SIC three- and four-digit levels or NAICS four- and five-digit industry levels.

Most of the data series that BEA receives from other agencies are not confidential. The agencies summarize this data to aggregate totals by program and by state or county, so that each record, or data cell, contains data for enough individuals or establishments to preclude the identification of the data for a specific individual or establishment and, therefore, to preclude the disclosure of confidential information.

However, the Quarterly Census of Employment and Wages (QCEW)tabulations that BEA receives from the Bureau of Labor Statistics (BLS) include records that would disclose confidential information. The confidential information on wages and salaries for some business firms is identifiable from the state and county estimates of wages and salaries at the SIC two-digit or NAICS subsector level that are derived from the QCEW data.

To prevent either the direct or the indirect disclosure of the confidential information, BEA uses the BLS state and county nondisclosure file.

BEA uses as many BLS nondisclosure cells as possible, but cannot use some of them for various reasons. The most important reasons are that the industry structure published by BEA does not exactly match the SIC two-digit or NAICS subsector detail provided by BLS and that BEA does not use QCEW data for the farm sector. When BEA drops BLS nondisclosure cells, other cells must be selected to prevent the disclosure of confidential information. In order to determine which estimates should be suppressed, the total wages and salaries file and the wages-and-salaries-nondisclosure file are used to prepare a multidimensional matrix. This matrix is tested, and the estimates that should be suppressed are selected.