Trump fires BLS commissioner, raising concerns about economic data quality

Reuters

2 days ago

WASHINGTON, Aug 1 (Reuters) - U.S. President Donald Trump fired the Labor Department's Bureau of Labor Statistics Commissioner Erika McEntarfer on Friday after data showed weaker-than-expected employment growth in July and massive downward revisions to the prior two months' job counts.
Trump accused McEntarfer, who was appointed by former President Joe Biden, of faking the jobs numbers. There is no evidence to back Trump's claims of data manipulation by the BLS, the statistical agency that compiles the closely watched employment report as well as consumer and producer price data.
The U.S. economy created only 73,000 jobs in July. Data for May and June were revised sharply down to show 258,000 fewer jobs created than had been previously reported.
"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," Trump said in a post on Truth Social.
The BLS did not immediately respond to a request for comment.
William Wiatrowski, the deputy commissioner, will serve as acting commissioner.
The Trump administration's recent mass layoffs of federal government workers have raised concerns about the quality of U.S. economic data, long seen as the gold standard.
Economists, labor unions and Democratic Party leaders criticized the firing as an attempt by the Trump administration to manipulate data and warned of lasting damage to the economy.
"The civil servants at BLS are not political actors. They are professionals committed to producing accurate, independent data, regardless of who is in power," said American Federation of Government Employees national president Everett Kelley.
McEntarfer had worked in the federal government for more than two decades under multiple administrations, Kelley said.
Trump-aligned Republicans were supportive of the BLS firing, calling McEntarfer a "Biden holdover."
"Politicizing economic statistics is a self-defeating act," said Michael Madowitz, principal economist at the Roosevelt Institute's Roosevelt Forward.
"Credibility is far easier to lose than rebuild, and the credibility of America's economic data is the foundation on which we've built the strongest economy in the world. Blinding the public about the state of the economy has a long track record, and it never ends well."
Earlier this year, Commerce Secretary Howard Lutnick disbanded two expert committees that worked with the government to produce economic statistics.
Lutnick has also floated the idea of stripping out government spending from the gross domestic product report, claiming "governments historically have messed with GDP."
The BLS has already reduced the sample collection for consumer price data as well as the producer price report, citing resource constraints. The government surveys about 121,000 businesses and government agencies, representing approximately 631,000 individual worksites for the employment report.
The response rate has declined from 80.3% in October 2020 to about 67.1% in July.
"In my opinion, today's Jobs Numbers were RIGGED in order to make the Republicans, and ME, look bad," Trump wrote in another Truth Social post, without offering any evidence.
Economists attributed the near-stall in job growth to Trump's trade and immigration policies. They said uncertainty about where Trump's tariff level would settle had made it difficult for businesses to plan long-term.
More clarity has emerged as the White House has announced trade deals, but economists said the effective tariff rate was still the highest since the 1930s. Trump slapped dozens of trading partners with steep tariffs on Thursday, including a 35% duty on many goods from Canada.