[Federal Register Volume 88, Number 63 (Monday, April 3, 2023)]
[Notices]
[Pages 19606-19607]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-06774]


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DEPARTMENT OF COMMERCE

Census Bureau

[Docket Number: 230301-0059]


Differential Privacy Methodology for County Business Patterns 
Data

AGENCY: Census Bureau, Department of Commerce.

ACTION: Notice and request for comment.

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SUMMARY: The U.S. Census Bureau (Census Bureau) has been working to 
implement modernized methods to continue to ensure the privacy 
protections of its information products and seeks public engagement and 
comment on these efforts. The Census Bureau is targeting the release 
the 2022 County Business Patterns (CBP) data using differential privacy 
methodology for disclosure avoidance. The Census Bureau has created 
demonstration tables and invites the public to participate in a live 
question-and-answer webinar on April 20, 2023, to learn more about how 
the differential privacy methodology is being applied to the CBP data. 
This Notice requests written comments on the demonstration tables and 
other issues related to this topic.

DATES: A live question-and-answer webinar will be held on Thursday, 
April 20, 2023, at 3 p.m. Eastern Daylight Time, for discussion of how 
the differential privacy methodology is applied to the CBP data. The 
webinar will be recorded.
    Written comments must be submitted on or before June 2, 2023.

ADDRESSES: The webinar will be made available at https://www.census.gov/data/academy/webinars/2023/differential-privacy-webinar.html Demonstration tables are available at https://www.census.gov/topics/business-economy/disclosure/data/tables.html.
    Please direct all written comments to Margaret Beckom, 
Dissemination Standards Branch, Economic Management Division, U.S. 
Census Bureau.
    Email: [email protected] with the subject CBP Disclosure 
Feedback.
    Phone: 301-763-7522.

FOR FURTHER INFORMATION CONTACT: Margaret Beckom, Dissemination 
Standards Branch, Economic

[[Page 19607]]

Management Division, U.S. Census Bureau. Email: 
[email protected]; Phone: 301-763-7522.

SUPPLEMENTARY INFORMATION: 

County Business Patterns Program Background

    The CBP is an annual series that provides subnational economic data 
by industry. This series includes estimates of the number of 
establishments, employment during the week of March 12, first quarter 
payroll, and annual payroll for subnational geographic areas. This data 
is useful for studying the economic activity of small areas; analyzing 
economic changes over time; and as a benchmark for other statistical 
series, surveys, and databases between economic censuses. Businesses 
use the data for analyzing market potential, measuring the 
effectiveness of sales and advertising programs, setting sales quotas, 
and developing budgets. Government agencies use the data for 
administration and planning.

Current Disclosure Avoidance Methodology

    A noise infusion technique referred to as multiplicative noise has 
been the Census Bureau's disclosure avoidance methodology for CBP data 
since reference year 2007. This method of disclosure avoidance perturbs 
each establishment's data prior to table creation by applying a random 
noise multiplier to the magnitude data (i.e., characteristics such as 
first-quarter payroll, annual payroll, and number of employees) for 
each establishment. Each published table's cell value has an associated 
noise flag indicating the relative amount of distortion in the cell 
value resulting from the perturbation of the data contributing to the 
cell. The flag for ``low noise'' (G) indicates the cell value was 
changed by less than 2 percent with the application of noise, the flag 
for ``moderate noise'' (H) indicates the value was changed by at least 
2 percent but less than 5 percent, and the flag for ``high noise'' (J) 
indicates the value was changed 5 percent or more. Values for some 
cells in the table may be suppressed (denoted with an S) because of 
concerns about the quality of the data. Also, beginning with reference 
year 2017, a cell is only published if it is based on data from three 
or more establishments. In all other cases, the cell is not included in 
the release (i.e., the corresponding table row is dropped from 
publication).

Differential Privacy Methodology

    The proposed statistical disclosure limitation approach makes use 
of controlled, randomized noise added to published statistics to limit 
the extent to which public data users can make inferences about 
establishments in the internal, private CBP database. The approach 
includes two components: (1) Per-Record Differential Privacy, which 
gives a formal, mathematically provable privacy guarantee against exact 
inferences about establishments in the private database; and (2) non-
differentially private, second-stage noise. Second-stage noise does not 
confer a formal privacy guarantee, but it ensures that large 
establishments present in published CBP statistics have a level of 
relative protection that increases as the number of establishments 
contributing to a published statistic decreases.

Demonstration Tables for New Differential Privacy Methodology for 
Disclosure Avoidance

    The Census Bureau has created demonstration tables to illustrate 
how the new differential privacy methodology for disclosure avoidance 
can be applied to produce CBP estimates and will discuss this 
application during the April 20th webinar. These tables can be viewed 
at https://www.census.gov/topics/business-economy/disclosure/data/tables.html. The tables show estimates of the number of establishments, 
number of employees, first-quarter payroll, and annual payroll across 
geographic, industry, legal form of organization, and employment size 
levels. The input data for the demonstration tables are a set of 
synthetic microdata created solely from previously published CBP 
results. This approach ensures that existing disclosure avoidance 
safeguards are not compromised by the publication of the demonstration 
tables. The demonstration tables also include summary statistics of the 
uncertainty introduced by the new differential privacy methodology and 
comparison with the uncertainty introduced by the current disclosure 
avoidance methodology. We invite comments on these demonstration 
tables, including use cases (examples of how CBP data are used) and 
whether the new methodology affects these use cases (including whether 
the amount of noise shown in the demonstration tables would prevent or 
change any analyses for those use cases).
    Robert L. Santos, Director, Census Bureau, approved the publication 
of this Notice in the Federal Register.

    Dated: March 2, 2023.
Shannon Wink,
Program Analyst, Policy Coordination Office, U.S. Census Bureau.
[FR Doc. 2023-06774 Filed 3-31-23; 8:45 am]
BILLING CODE 3510-07-P