The latest non-farm payrolls data from the Bureau of Labor Statistics (BLS) was clearly not received well in the White House. Unusually large back revisions to the figures for June and May suggest that the jobs market has slowed more sharply than originally believed over the last three months. President Trump’s response was to immediately fire the head of the BLS.
I was just informed that our Country’s “Jobs Numbers” are being produced by a Biden Appointee, Dr. Erika McEntarfer, the Commissioner of Labor Statistics, who faked the Jobs Numbers before the Election to try and boost Kamala’s chances of Victory. This is the same Bureau of Labor Statistics that overstated the Jobs Growth in March 2024 by approximately 818,000 and, then again, right before the 2024 Presidential Election, in August and September, by 112,000. These were Records — No one can be that wrong? We need accurate Jobs Numbers. I have directed my Team to fire this Biden Political Appointee, IMMEDIATELY. She will be replaced with someone much more competent and qualified. Important numbers like this must be fair and accurate, they can’t be manipulated for political purposes. McEntarfer said there were only 73,000 Jobs added (a shock!) but, more importantly, that a major mistake was made by them, 258,000 Jobs downward, in the prior two months. Similar things happened in the first part of the year, always to the negative.
He then went on to launch his usual and, by now, all too familiar attack on the Federal Reserve for not cutting interest rates sooner.
The sacking of Dr. McEntarfer is a worrying development that should concern anyone who hopes for good macroeconomic policy outcomes.
Dr. McEntarfer, whose appointment was passed by the Senate on an 86 to 6 vote, is a respected public servant widely seen as, in the President’s words, ‘competent’ and ‘qualified’.
The revisions unveiled this month were, if it is true, unusually large. But collecting accurate jobs market figures has become trickier in most advanced economies as response rates to surveys have declined in recent years. The response rate for the BLS’s establishment survey of businesses has fallen from around 60% before the pandemic to just about 40% in recent months. In the United Kingdom, a declining response rate to the so-called ‘gold standard’ labour force survey has taken confidence in the official employment data to a new low and led to policymakers increasingly relying on alternative data such as tax records.
There is, importantly, zero evidence that the revisions were in any way ‘political’.
The Clark Center’s US Experts Panel was asked last week whether, ‘there is no evidence to suggest that the employment estimates produced by the Bureau of Labor Statistics are biased so as to favor any particular political party’?
Weighted by confidence, 92% of respondents strongly agreed, and the other 8% agreed.
The comments that respondents offered alongside their answers speak to the depth of feeling on this issue.
David Autor of MIT noted that ‘Revisions are routine, and tend to be larger when economic conditions are changing rapidly. McEntarfer is a non-partisan economist and BLS’ procedures are consistent, credible, and not subject to manipulation. No evidence supports the slander that BLS estimates were ‘rigged.’ While Caroline Hoxley of Stanford argued that, ‘BLS statistics are produced in a way that has been consistent for many years. The staff who conduct the surveys and compute the statistics are non-partisan. They are interested only in accurate data and statistics. The BLS produces many statistics so that we can choose among them’.
Jose Scheinkman of Colombia went further, stating that ‘Trump emulates “electoral autocrats” like Erdogan and Orbán by seizing control of stats agencies. BEA may be next; autocrats typically inflate GDP (Martinez, 2022). Private efforts, like Cavallo’s in Kirchner’s Argentina, may offer alternatives, but lack federal precision’.
This is not the first time the current administration has taken steps that look to be hindering the accuracy of US data. Back in March, the US Experts Panel expressed concern that the elimination of the Federal Economic Statistics Advisory Panel and the shrinking of staff numbers at core statistics agencies would impair the accuracy of US data.
As your columnist wrote at the time:
To understand the importance of reliable data to economic policymaking, think about driving without an accurate speedometer. Knowing when to press on the brakes and when to push down on the accelerator, and how firmly to do either one, is much trickier if a driver is not sure exactly how fast they are going. For the people who help guide economic policy, reliable, timely, and reasonably accurate economic statistics play an analogous role.
The administration is sending a clear message that economic data that is politically inconvenient is unwelcome. It seems they prefer to drive with an inaccurate speedometer. That rarely ends well for the driver or the car itself.
