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The Guardian
05-08-2025
- Business
- The Guardian
Trump firing of statistics chief puts US data credibility at risk, experts warn
Donald Trump's firing of the head of the main agency for producing jobs figures risks propelling the US into the same category as countries notorious for 'cooking the books' such as Argentina and Greece, experts have warned. Donald Trump fired Erika McEntarfer, the Bureau of Labor Statistics (BLS) commissioner last Friday, after accusing her agency of 'faking' the latest employment figures for 'political purposes,' which showed the US economy adding a lower-than-expected 73,000 jobs in July. The BLS, the US government official source for labor statistics since 1884, also revised down the estimates of new positions created in May and June by a combined 258,000. Trump provided no evidence for his accusations against McEntarfer, which he reinforced in social media posts on Monday, calling the bureau's latest reports 'rigged' and concocted. But his decision jeopardizes the US's tradition of impartial and reliable statistic collection on which the country's economic stability and international reputation depends, specialists have told the Guardian. Erica Groshen, McEnterfer's predecessor as BLS commissioner during Barack Obama's presidency, warned earlier this year that an impending civil-servant rule change that presaged last Friday's sacking could usher in a 'politicization' of government statistical bodies – whereby experts are pressured to produce massaged numbers that fitted an incumbent president's agenda. She raised the specter of Greece and Argentina, where official statistics became discredited as a result of government-instigated misrepresenting of figures. The International Monetary Fund stopped accepting the Argentinian government's inflation figures in 2013 after officials were found to have deliberately understated the rate for the previous six years. After threatening Argentina – historically one of the IMF's biggest borrowers – with expulsion, the organization did not extend another loan to it until 2018. In the case of Greece, government statisticians were accused of having made inflation and soaring budget deficits 'disappear' in the 1990s as the country sought respectable-looking numbers that would enable to qualify for the single European currency, the euro. Greece subsequently joined the currency, but at an exorbitant long-term price. The 2008 global financial crash plunged its economy into a deep recession, and the government was forced to accept multi-billion dollar bailouts from the IMF and European Union – at the cost of painful cuts to social services. Andreas Georgiou, who became head of Greece's main statistics agency during the crisis, even faced prosecution after he discovered that authorities had been dramatically understating budget deficits for years. Both countries experienced severe political backlashes. In Argentina, after two further IMF loans failed to stabiliize its economy, Javier Milei, a populist economist and ally of Trump, was elected in 2023 promising to take a chainsaw to the governing bureaucracy and many public services. In Greece, a succession of left and rightwing governments have taken office amid a rise in support for radical and populist parties, giving rise to concerns for the health of the country's democracy. Talking to the Guardian, Groshen warned of comparable scenarios following a rule change rolled by the White House's office of personnel management in April. 'Bureau of Labor Statistics leaders could be fired for releasing or planning to release jobs or inflation statistics unfavorable to the president's policy agenda,' she wrote in a briefing paper. The revision altered the category of about 50,000 permanent civil servants to 'policy/career' status, making their removal easier. Originally tabled in April to allow 30 days for comments, it gave agencies the right 'to expeditiously remove career employees in policy-influencing positions for poor performance or misconduct, such as corruption or for injecting partisanship into the performance of their official duties'. The precise roles of officials affected were not defined, but Groshen pointed out that, if implemented, the president would determine who would be reclassified. The change stemmed from an executive order Trump issued on his first day back in the White House on 20 January. It stated that the power of 'policy-influencing' civil servants is 'delegated by the president, and they must be accountable to the president'. Groshen, now a specialist in government statistics at Cornell University, said the changes in civil servant status would make it easier for the government to tamper with numbers it disliked. 'There are a number of changes to the civil service that makes it much easier for the administration to interfere with the activities of statistical agencies and that worries me,' she said. Under increased threat of removal, civil servants in federal statistics bodies 'might also face pressure to change methodologies or reveal pre-release information', she wrote. 'By making it easier to remove employees if a president determines that they are interfering with his or her policies, it increases the potential for passivity or political loyalty to be prioritized over expertise and experience.'
Yahoo
04-08-2025
- Business
- Yahoo
The jobs data revisions that cost a US government statistician her job
(Reuters) -The revisions to previous estimates of the size of U.S. payrolls gains for May and June that prompted President Donald Trump to fire Bureau of Labor Statistics Commissioner Erika McEntarfer on Friday were by any measure extraordinarily large. Indeed, the combined downward revision for the two months of 258,000 was the largest - outside of those during the early months of the COVID-19 pandemic - since at least 1979. Here's a quick graphical breakdown: FIRST REVISION The monthly nonfarm payrolls report, released typically on the first Friday of each month, includes an initial estimate of employment changes for the immediately preceding month and revisions to the earlier estimates for the prior two months. BLS makes the revisions because more survey responses come in over the ensuing weeks and because it updates the seasonal factors affecting each month's estimates. The BLS on Friday said 133,000 fewer jobs had been created in June than first estimated. Over the last several years, the first estimate of the net change in payrolls each month has been revised lower more often than not. It has been revised down in eight of the last 12 BLS reports over the last year. The downward revision on Friday was the largest since the first estimate of payrolls gains for March 2021, published in April 2021, was revised down by 146,000 a month later. Over the last three years through June, the median estimate revision was -10,000. That contrasts with a median increase of 8,000 during the decade before the pandemic and a median increase of 2,000 over the series history since 1979. SECOND REVISION The total for May's payroll gains was revised lower by 125,000 in Friday's report, when the third estimate for payrolls for that month was published. That figure was the largest downward reduction of payrolls gains for a second revision - outside of the pandemic era - since the estimate for March 1983 was revised down by 127,000 in the report published in June 1983. COMBINED REVISION The combined downward revision for the two previous months - May and June - was larger than anything reported outside of the pandemic era. Indeed, the estimates for the two prior months combined have more often than not been revised higher. Since 1979, the median two-month combined estimate change was an upward revision of 10,000. Measured in absolute terms - revisions in either direction - Friday's revision also stands out. There have only been four larger revisions: +709,000 for November and December 2021; -642,000 for March and April 2020; +285,000 for August and September 1983; and +414,000 for April and May 1981. Solve the daily Crossword
Yahoo
04-08-2025
- Business
- Yahoo
Social Security Retirees Just Got Bad News From President Donald Trump
Key Points President Trump imposed a hiring freeze across federal agencies that has hindered the Bureau of Labor Statistics' (BLS) ability to track inflation. Questionable inflation data raises concerns about whether Social Security's 2026 cost-of-living adjustment (COLA) will be accurate. President Trump's firing of BLS Commissioner Erika McEntarfer threatens to politicize the independent agency and further erode confidence in inflation data. The $23,760 Social Security bonus most retirees completely overlook › President Trump promised on several occasions to protect Social Security, Medicare, and Medicaid during his campaign last year. He has not overtly broken his promise not to cut Social Security benefits, but his federal hiring freeze and decision to fire Bureau of Labor Statistics Commissioner Dr. Erika McEntarfer could still hurt retirees and other beneficiaries. Read on to learn more. President Trump's federal hiring freeze threatens the integrity of data needed for Social Security's 2026 COLA President Trump instituted a federal hiring freeze after his inauguration on January 20. The freeze has twice been extended and is currently effective until October 15. Importantly, while it does not directly hurt Social Security beneficiaries, it has forced the Bureau of Labor Statistics (BLS) to use a less accurate guesswork to track inflation, according to The Wall Street Journal. That matters because inflation data gathered between July and September will be used to calculate Social Security's cost-of-living adjustment (COLA) for 2026. Should that data underestimate true inflation, benefits would lose buying power next year because the COLA would be too small. Of course, it is equally possible the data overestimates inflation, in which case benefits would gain purchasing power because the COLA would be too large. Nevertheless, questionable inflation data will make the 2026 COLA suspect, and the timing is particularly bad. The Senior Citizens League, a nonprofit advocacy group, estimates 20% of Social Security's buying power has been stripped by insufficient COLAs since 2010. Additionally, most retired workers think the last two COLAs were too small, according to research from The Motley Fool. President Trump's decision to fire the BLS commissioner could further undermine data integrity President Trump ousted BLS Commissioner Erika McEntarfer on Friday, August 1, when the agency not only published dismal employment numbers for July, but also downwardly revised estimates from May and June. Details are provided below: Nonfarm payrolls increased 73,000 in July, well short of the consensus estimate that said employment would increase by 110,000 workers. Nonfarm payrolls were originally reported to have increased 147,000 in June, but that figure was revised down to 14,000 workers. Nonfarm payrolls were originally reported to have increased 144,000 in May, but that figure was revised down to 19,000 workers. Importantly, downward revisions to nonfarm payroll numbers are common because the survey results used to tabulate employment continue to roll in for several months after the initial report. But the magnitude of the latest downward revision was the largest since 2020 and second largest since 1980. Trump, without offering any evidence, insinuated the downward revisions were a politically motivated attack. He promptly told his team to fire Commissioner McEntarfer, much to the dismay of many economists. Her predecessor, Trump-appointee William Beach, called the decision "totally groundless." He also said it "sets a dangerous precedent and undermines the statistical mission of the Bureau." Many economists have echoed that opinion, noting that Trump himself is probably responsible for weak employment numbers because of radical changes in U.S. trade policy. The stop-and-start tariffs imposed throughout the year have created uncertainty across corporate America, and it makes little sense to hire more employees during periods of elevated economic uncertainty. Regardless, Trump's decision to fire McEntarfer (seemingly because he did not like the latest employment data) raises a critical question: Will Americans trust nonfarm payrolls data in the future, or will they question its integrity because Trump is attempting to politicize an independent agency? By extension, that question also applies to the other data for which the BLS is responsible, including inflation data used to calculate Social Security's COLAs. Put differently, while the firing of McEntarfer will not directly hurt retirees, it could further undermine confidence in inflation data published by the BLS. That is bad news for Social Security beneficiaries. The $23,760 Social Security bonus most retirees completely overlook If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known could help ensure a boost in your retirement income. One easy trick could pay you as much as $23,760 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Join Stock Advisor to learn more about these Motley Fool has a disclosure policy. Social Security Retirees Just Got Bad News From President Donald Trump was originally published by The Motley Fool
Yahoo
04-08-2025
- Business
- Yahoo
Social Security Retirees Just Got Bad News From President Donald Trump
Key Points President Trump imposed a hiring freeze across federal agencies that has hindered the Bureau of Labor Statistics' (BLS) ability to track inflation. Questionable inflation data raises concerns about whether Social Security's 2026 cost-of-living adjustment (COLA) will be accurate. President Trump's firing of BLS Commissioner Erika McEntarfer threatens to politicize the independent agency and further erode confidence in inflation data. The $23,760 Social Security bonus most retirees completely overlook › President Trump promised on several occasions to protect Social Security, Medicare, and Medicaid during his campaign last year. He has not overtly broken his promise not to cut Social Security benefits, but his federal hiring freeze and decision to fire Bureau of Labor Statistics Commissioner Dr. Erika McEntarfer could still hurt retirees and other beneficiaries. Read on to learn more. President Trump's federal hiring freeze threatens the integrity of data needed for Social Security's 2026 COLA President Trump instituted a federal hiring freeze after his inauguration on January 20. The freeze has twice been extended and is currently effective until October 15. Importantly, while it does not directly hurt Social Security beneficiaries, it has forced the Bureau of Labor Statistics (BLS) to use a less accurate guesswork to track inflation, according to The Wall Street Journal. That matters because inflation data gathered between July and September will be used to calculate Social Security's cost-of-living adjustment (COLA) for 2026. Should that data underestimate true inflation, benefits would lose buying power next year because the COLA would be too small. Of course, it is equally possible the data overestimates inflation, in which case benefits would gain purchasing power because the COLA would be too large. Nevertheless, questionable inflation data will make the 2026 COLA suspect, and the timing is particularly bad. The Senior Citizens League, a nonprofit advocacy group, estimates 20% of Social Security's buying power has been stripped by insufficient COLAs since 2010. Additionally, most retired workers think the last two COLAs were too small, according to research from The Motley Fool. President Trump's decision to fire the BLS commissioner could further undermine data integrity President Trump ousted BLS Commissioner Erika McEntarfer on Friday, August 1, when the agency not only published dismal employment numbers for July, but also downwardly revised estimates from May and June. Details are provided below: Nonfarm payrolls increased 73,000 in July, well short of the consensus estimate that said employment would increase by 110,000 workers. Nonfarm payrolls were originally reported to have increased 147,000 in June, but that figure was revised down to 14,000 workers. Nonfarm payrolls were originally reported to have increased 144,000 in May, but that figure was revised down to 19,000 workers. Importantly, downward revisions to nonfarm payroll numbers are common because the survey results used to tabulate employment continue to roll in for several months after the initial report. But the magnitude of the latest downward revision was the largest since 2020 and second largest since 1980. Trump, without offering any evidence, insinuated the downward revisions were a politically motivated attack. He promptly told his team to fire Commissioner McEntarfer, much to the dismay of many economists. Her predecessor, Trump-appointee William Beach, called the decision "totally groundless." He also said it "sets a dangerous precedent and undermines the statistical mission of the Bureau." Many economists have echoed that opinion, noting that Trump himself is probably responsible for weak employment numbers because of radical changes in U.S. trade policy. The stop-and-start tariffs imposed throughout the year have created uncertainty across corporate America, and it makes little sense to hire more employees during periods of elevated economic uncertainty. Regardless, Trump's decision to fire McEntarfer (seemingly because he did not like the latest employment data) raises a critical question: Will Americans trust nonfarm payrolls data in the future, or will they question its integrity because Trump is attempting to politicize an independent agency? By extension, that question also applies to the other data for which the BLS is responsible, including inflation data used to calculate Social Security's COLAs. Put differently, while the firing of McEntarfer will not directly hurt retirees, it could further undermine confidence in inflation data published by the BLS. That is bad news for Social Security beneficiaries. The $23,760 Social Security bonus most retirees completely overlook If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known could help ensure a boost in your retirement income. One easy trick could pay you as much as $23,760 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Join Stock Advisor to learn more about these Motley Fool has a disclosure policy. Social Security Retirees Just Got Bad News From President Donald Trump was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
