Among all the ways a government shutdown could potentially disrupt the economy, market observers need to pay particular attention to one aspect: the absence of crucial new data.

Beyond furloughed personnel and suspended operations, a government shutdown would also interrupt important work outputs, including core data that central bank officials, corporate executives, analysts, and investors rely on to interpret the economy and make funding decisions.

The current timing is critical — unless parties can reach some form of agreement, the highly significant September non-farm payrolls report, originally scheduled for release by the Bureau of Labor Statistics on Friday, will be forced into delay. This could leave the Federal Reserve in a position of "blind judgment" for its next interest rate decision.

The current situation is particularly concerning because under Chairman Jerome Powell's leadership, the Fed has become extremely data-dependent — it closely monitors every data release and conducts detailed analysis and categorization within a "comprehensive" data framework. The absence of top-tier data such as the non-farm payrolls report and the government's two core inflation reports would create enormous data gaps in economic analysis.

However, even before this government shutdown threat emerged, policymakers and economists had already signaled they were turning toward more diversified data sources, such as the Automatic Data Processing Inc private payrolls data set for release Wednesday morning.

These data gaps — at least those related to the labor market — are gradually being filled.

Fed Governor Christopher Waller, a potential candidate for the next Fed chair, stated in a speech last month that he references ADP data to assess labor market conditions and believes the current labor market continues to weaken. Earlier this summer, ADP's U.S. private payrolls data was first to show signs of labor market softening, before the government subsequently revised its own data. This demonstrates the prescience of Waller's analytical approach.

Wall Street economics research teams have long used diversified data sources. But just last week, prominent bond firm DoubleLine, led by Jeffrey Gundlach, indicated the company is combining various official and private data sources to assess economic conditions, with the direct reason being the declining quality of Bureau of Labor Statistics data releases.

DoubleLine fixed income allocation strategist Ryan Kimmel noted in a report last week: "Given the problems with accuracy and reliability in Bureau of Labor Statistics data... adopting a robust, multi-dimensional economic analysis approach is more important than ever." The report also mentioned that the Bureau of Labor Statistics' data collection scope has significantly narrowed over the years, with increasing reliance on model estimates rather than actual observed data.

In August, market turbulence following downward revisions to previously released employment data led President Trump to dismiss the Bureau of Labor Statistics commissioner. This decision sparked further questions about the future accuracy of the agency's widely watched employment and inflation reports — with data quality already under close scrutiny due to the agency's prior hiring freeze.

Nevertheless, Wall Street, economists, and investors still highly value official data released by the Bureau of Labor Statistics and other government agencies. In a year filled with uncertainty, the interruption of key data only adds to the unclear situation: with the Fed losing core "analytical tools," economic policy can only proceed "step by step," hoping this approach will suffice to address the current circumstances.