The federal agency had just published the monthly jobs report, a release that business executives, Wall Street traders and Federal Reserve officials spend weeks anticipating. The figures showed that July hiring was below forecast. But the more striking news: BLS said it had overestimated May and June job creation by 258,000, revealing that the U.S. labor market was much weaker than previously thought.
McEntarfer went on with her day, Aug. 1, mingling with staff and complaining to one colleague that construction on Washington’s Metrorail was going to disrupt her commute. She didn’t know then that her trip home that evening would be the final leg of a two-decade career in the federal statistics system.
At the White House, Trump’s economic advisers had briefed him the day before about the jobs report, disclosing the revisions that upended what the president and his team had previously promoted as political wins. The president wasn’t happy.
Trump privately aired one of his longstanding complaints that the federal agency producing the data was dysfunctional, according to a senior administration official. A White House official said the president was upset about the revisions and alleged data inaccuracies but declined to comment on Trump’s private discussions.
“President Trump believes businesses, households and policymakers deserve accurate data when making major policy decisions, and he will restore America’s trust in this key data,” White House spokeswoman Taylor Rogers said.
After the BLS released the number, Trump’s aides appeared on financial cable channels to voice a positive spin. The president wrote on social media that the agency’s numbers had been rigged for years and people there were out to damage him politically. Trump demanded his staff fire McEntarfer.
At 1:36 p.m. that day, the agency leader became another labor statistic, one of the nation’s unemployed. At 2:09 p.m., the president announced the firing on social media.
Trump offered no concrete evidence the BLS had manipulated the jobs numbers, either by mistake or design. The agency performs one of the government’s least political tasks: collecting data and compiling statistics. The president and his aides said in interviews that the proof of wrongdoing was the significant change from previous jobs reports.
Economists defended McEntarfer and said that revisions, even large ones, are evidence of the system’s integrity.
The BLS, part of the Labor Department, and its partner agencies in the Commerce Department operate largely out of public view. Yet the weekly and monthly cadence of reports is practically sanctified by business executives and investors who depend on government data that tracks inflation, hiring and other economic metrics to steer companies and capital through America’s $30 trillion economy.
Despite its importance, the agency has struggled to modernize a system that relies on phone calls and in-person visits. A federal hiring freeze has made it more difficult to keep pace with staff losses while collecting comprehensive economic statistics.
Dozens of well-known economists sent a letter to Congress on July 29, warning that the government’s statistics system was approaching a breaking point. They said the responsible agencies needed a budget that supports new data techniques in parallel with current practices.
“Without focused and funded efforts to modernize how these essential statistics are collected and produced, the quality and quantity of the system’s output are at risk,” the economists wrote.
During a budget squeeze last year, the BLS narrowly avoided cutting the number of households it calls for the survey that sets the unemployment rate. The agency this year struggled with its most labor-intensive survey — gathering tens of thousands of prices each month to calculate its main inflation measure. Staff shortages forced the BLS to skip price checks in three of 75 cities.
BLS acting commissioner William Wiatrowski sent an email to the agency’s staff, assuring them that the agency’s mission was unchanged.
On Thursday evening, Trump met with Stephen Moore, an economist at the right-leaning Heritage Foundation, who presented his own, more upbeat economic statistics.
As Trump looked on, Moore flashed a set of charts in front of TV cameras and told reporters that he had used yet-to-be-published Census Bureau data to determine that household income had risen by more than $1,000 during Trump’s second term so far.
There isn’t yet any official data on household income during Trump’s second term because of the lengthy time it takes to collect surveys from 75,000 American households.
“I called the president up because I had some very good news from some new data that we’ve been able to put together that no one has ever seen before,” said Moore, who didn’t reveal how he obtained the unpublished data.
Trump had briefly nominated Moore to the Federal Reserve Board during his first term, before broad opposition led Moore to withdraw his name.
Those who have worked for the BLS in recent decades share a common memory. Early in their training, they were shown a video recounting how in 1971, former President Richard Nixon grew paranoid that a group of BLS employees sought to undermine him by presenting falsely unfavorable labor-market figures. Nixon ordered them demoted.
The message was that BLS employees must maintain unimpeachable integrity because elected officials unhappy with statistical findings might accuse the agency of malfeasance, said Andrew Cohen, a former BLS employee who saw the film in 2003. “It was, ‘Watch your words, because people out there will sometimes try to twist your words and accuse you of fraud,'” Cohen said.
BLS operations have changed little over the past decades, relying on some of the world’s largest surveys to ask people and businesses about their economic lives. The agency tabulates the unemployment rate, for example, by calling 60,000 households and asking job questions over the phone. The agency has looked into switching to an internet survey, but accuracy and reliability are seen as so critical that its stodgy workhorse of a system still appeals to many experts and data users more than a modern, untested replacement.
Commerce Secretary Howard Lutnick, a newcomer to politics after a career running a Wall Street brokerage, swept into Washington this year ready to shake up the statistics system. Two weeks after his confirmation, Lutnick mused publicly that the Commerce Department’s Bureau of Economic Analysis would remove government spending from the calculation of the size of the U.S. economy — known as gross domestic product or GDP. Such a change to the nearly century-old measure of the nation’s economic health would be about as drastic as taking sugar out of a cookie recipe.
Like many outside of government, Lutnick also expressed astonishment about the timeworn, analog fashion that BLS workers collect data. They “literally call to Lincoln, Nebraska, and ask what the price of cargo pants is,” Lutnick said in a magazine interview last month.
The truth is, there isn’t anyone checking prices in Lincoln anymore.
Lincoln is one of 75 locales in the U.S. where the BLS checks prices in person to calculate inflation, a job that until recently was chiefly handled by two local agency employees, Deborah LaPlante and LynnAnn Scharf.
The two women spent their days working independently, driving to auto dealers, medical offices and clothing stores around Lincoln, where they recorded the prices of various goods and services including SUVs, doctor’s visits, shirts and pants. Over the years, Scharf befriended store managers on her rounds and taught one how to use published BLS data to learn about the economy. She and LaPlante always tried to meet for lunch, she said, but it was hard to find time.
Scharf left the BLS in June last year, and now, in her 60s, works as a horticulturist for the local parks department, a lower-stress job. LaPlante died in September, Scharf said. The BLS would typically have hired replacements. But on the first day of his second term, Trump ordered a government hiring freeze. By June, price checks ground to a halt in Lincoln, Provo, Utah, and Buffalo, N.Y.
The BLS’s other 72 price-checking zones also face staffing shortages. In those places, the agency is missing about 15% of the prices it would normally aim to collect, the agency said. The BLS is now getting only about 80% of the price data it used to, according to Omair Sharif, founder of analysis firm Inflation Insights.
Turnover is high among front-line agency price-checkers, who earn, on average, about $45,000 a year. In the past, the BLS hired roughly the same number of price checkers as those who left, according to records reviewed by The Wall Street Journal. Yet between October of last year — the start of the government’s fiscal year — and mid-June, the agency’s inflation-data staff lost substantially more workers than it added.
The BLS recently said it planned to discontinue 350 data series from the producer-price index, eliminating data on wholesale prices for such items as leather goods, lawn furniture and candles.
The resource squeeze has been under way for more than a decade. In inflation-adjusted terms, the agency’s spending power — based on annual budgets of around $650 million — fell by about a fifth over the past 15 years, according to The Friends of the Bureau of Labor Statistics, a BLS advocacy group.
For the coming fiscal year, the Trump administration asked Congress to reduce the BLS budget by about 10%, saying the cuts would be made up from cost savings in its plans to merge the BLS into the Commerce Department. The economists who wrote to Congress warning of a crisis — who included former BLS commissioner Erica Groshen, former Federal Reserve Vice Chairman Alan Blinder and Nobel winner Paul Romer — begged lawmakers to, at worst, keep funding unchanged.
While the number of workers shrinks, the task of asking individuals and businesses to volunteer their data has become a tough sell.
The response rate for the monthly survey used for unemployment statistics has dropped below 70% from nearly 90% a decade ago. When businesses are asked how many workers they employ, more are late to reply. That means the BLS’s initial report on monthly job creation, on the first Friday of the following month, is more of a guess than ever, and big revisions are more likely as tardy data trickles in during the next weeks and months.
Last year, while McEntarfer was commissioner, the BLS published one batch of stats about a half-hour late and on another occasion published a set of figures a half-hour early — high-stakes mistakes given that traders collectively bet billions on what they predict the reports will say.
Carson Markley joined the BLS in Dallas in 2022, shortly after finishing a master’s degree in international relations. He was assigned to survey companies for the producer-price index, the key gauge of inflation for wholesale prices.
The job was sometimes frustrating because of a limited staff and a large workload, said Markley, who had to get company managers on the phone or catch them in person. Many businesses were reluctant to participate, worried about the time spent or that the government would leak or misuse private data, Markley said. Some he contacted thought it was a scam.
“From what my older colleagues told me, they used to be able to get data easily. They could get dozens of companies a week to sign up” to join surveys, Markley said. “Nowadays, everything’s so politically divisive that we weren’t able to.”
Markley said he was glad when he landed a new job in Chicago outside the federal government.
At a news conference last month, before McEntarfer was fired, Fed Chair Jerome Powell said the central bank was still getting the data it needed to make sound decisions on interest rates but emphasized the need to keep the stats system healthy.
“People in the economy, they use this data a lot,” Powell said. “It’s very hard to accurately capture in real time the output of a 20-plus-trillion-dollar economy. And the United States has been a leader in that for 100 years, and we really need to continue that.”
On Tuesday, the BLS will publish its most closely followed inflation measure, the consumer-price index, for July.
