President Donald Trump’s abrupt dismissal of the U.S. Commissioner of Labor Statistics after a disappointing employment report has raised concerns about the future accuracy and integrity of the nation’s vital jobs numbers.
Some economists and former government officials are responding to the mounting worries with a simple message: Chill out.
These experts cite three reasons Trump administration officials are not likely to manipulate the statistics for political reasons: There’s too much data underlying the most publicized jobs figures; broadly comparable numbers are published in other reports; and there are disincentives for chicanery.
“I think it would be pretty hard to revise any statistics” based on politics “or try to fudge the numbers somehow,” said Sara Estep, an economist at the left-leaning Center for American Progress.
Still, Estep and other experts say the trustworthiness of the data is being called into question – a development that itself could have a negative impact on the economy and markets – and outright attempts to massage the numbers aren’t out of the realm of possibility.
“The concern is that this could mark the start of a slippery slope toward greater White House influence over economic statistics, which in a worst-case scenario might involve censoring, reengineering, or suspending official releases like payrolls or CPI (inflation) to serve the Trump administration's agenda,” Capital Economics wrote in a note to clients.
In a statement, the White House said: “Historically abnormal revisions in BLS data over the past few years since COVID have called into question the BLS’s accuracy, reliability, and confidence. President Trump believes that businesses, households, and policymakers deserve accurate data to inform their decision-making, and he will restore America’s trust in the BLS.”
What was the jobs report for July?
On Aug. 1, Trump fired Erika McEntarfer, the commissioner of the Bureau of Labor Statistics, after the agency reported a disappointing 73,000 job gains in July and, more significantly, revised down payroll additions for May and June by a historically massive 258,000 positions.
Economists said the large revisions can be explained by small businesses’ unusually low response rates to BLS’ initial surveys as they grapple with cost increases from Trump’s double-digit tariffs on imports and the effects of the duties on business confidence and hiring.
But on Truth Social, Trump said without providing evidence that “today’s Jobs Numbers were RIGGED in order to make the Republicans, and ME, look bad,” noting McEntarfer was appointed by former Democratic President Joe Biden.
After firing McEntarfer, he appointed William Wiatrowskias interim BLS head and said he would name a permanent replacement within days.
William Beach, McEntarfer’s predecessor as BLS chief and a Trump appointee, said it’s “impossible” for a BLS commissioner to manipulate the jobs data. He added that the person doesn’t see the report until the numbers are loaded and readied for distribution on the Wednesday before its release on the first Friday of the month.
Keith Hall, who was appointed BLS commissioner by former President George W. Bush and served from 2008 to 2011, told USA TODAY that too many career, nonpartisan civil servants have a hand in drafting the report for the data to be distorted. About 40 people, both Republicans and Democrats, see the final jobs number shortly before publication, Beach previously said.
Is Trump trying to control independent federal agencies?
Yet, economists worry Trump could test that presumption. His removal of McEntarfer marks his latest challenge to federal agencies whose independence is critical for a smoothly functioning economy. For months, Trump has tried to badger Federal Reserve Chair Jerome Powell into lowering interest rates and has threatened to fire him, though experts say Powell can’t be removed without cause.
Economists say the jobs report is considered the global gold standard for accurate and unbiased economic data, providing the best broad snapshot of the U.S. economy in close-to-real time and helping guide the actions of investors, corporations, governments and consumers.
Trump’s removal of McEntarfer “presents risks to the conduct of monetary policy, to financial stability, and to the economic outlook,” JPMorgan Chase economist Michael Feroli wrote in a note to clients. He added, “The risk of politicizing the data collection process should not be overlooked.”
Here’s why some experts say they're not worried about the reliability of the jobs numbers:
Other federal job measures
If a BLS commissioner or other key employees finagled the jobs numbers, “discrepancies would quickly emerge in other metrics like jobless claims, which are reported at the state level and [are] less prone to federal influence,” Capital Economics said in its research note.
Initial unemployment insurance applications provide a reliable gauge of layoffs. And the jobs report represents the net total of all layoffs, hiring, quits, retirements and job switches across the economy.
Private jobs reports
Even if the administration “brought all major statistical agencies under tight control, economists and investors could still infer the true state of the economy from private sources,” Capital Economics said. Those include the ADP employment report and job postings from Indeed, the leading job search site.
“Any tampering with official data would likely be exposed sooner or later and would be politically damaging once uncovered,” Capital Economics said.
Markets are watching – and reacting
If evidence emerged that the administration was fiddling with the jobs data, investors likely would demand a higher return for holding assets such as U.S. Treasuries, pushing up interest rates, Capital Economics said. Trump has fervently advocated for lower rates.
The research firm added that “the administration has some inclination to avoid upsetting markets – especially when it leads to higher bond yields and increased debt-servicing costs.”
Trump tends to push the envelope but not rip it up
Trump has shown a propensity to push the boundaries in his efforts to achieve his goals “without clearly crossing” the line, Capital Economics said. For example, he has stopped short of firing the Fed’s Powell.
“This fits a broader pattern of the administration applying maximum pressure to get its way on issues from deportations to federal layoffs, without openly defying the courts,” Capital Economics wrote.
Lots of people compile the jobs report
The jobs report is like a massive puzzle put together by hundreds of employees and the pieces need to fit. If the final numbers were fudged, employees who worked on inputs to those numbers would realize that and speak up, Hall said.
“All of the data, detail and all of the industry statistics need to add up,” he said.
The underlying jobs data
BLS is famously transparent and provides the underlying data behind all its jobs numbers, Estep said. For example, the unemployment rate is based on a survey of 60,000 households, and the agency has its individual responses, she said.
At the same time, here’s why some experts are still worried:
Private jobs data relies on federal numbers
Although ADP and other private firms provide jobs data, they're typically “benchmarked to the federal data, as private sector data are very rarely nationally representative,” Feroli said. ADP, for instance, relies on the federal jobs report from two months earlier to estimate last month’s numbers.
The risk of political meddling
In a "Meet the Press" interview on August 3, Kevin Hassett, director of the National Economic Council, told moderator Kristen Welker, "The president wants his own people there (at BLS) so that when we see the numbers, they're more transparent and more reliable.”
Said Estep: “I would keep an eye out” for the potential replacement of some long-term public servants with political appointees at BLS and other agencies.
“Are they somehow installing more plans for the politicization of these statistical agencies?” Estep asked.
The data may be accurate, but is it trustworthy?
Even if it’s unlikely the data will be manipulated, “it may be less trusted,” Estep said, noting that could affect markets and the behavior of companies and consumers. "The trust component, that's really scary."
In an opinion piece posted on MSNBC.com, David Madland, senior fellow at the Center for American Progress, wrote: “Government data analysts will do their best to produce credible reports, and much of what they publish will be accurate, but these workers will be increasingly subject to political pressures, or outright meddling.
“Reputational damage has already been done ‒ and the decline in trust carries real consequences.”
(This story has been updated with more information.)
This article originally appeared on USA TODAY: Why Trump's firing of labor data chief won't threaten integrity of jobs figures. Probably
Reporting by Paul Davidson, USA TODAY / USA TODAY
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