Can We Still Trust the Monthly Jobs Report?

In the March 7, 2025 episode of "The Indicator from Planet Money" titled "Can ... We Still Trust the Monthly Jobs Report?", hosts Darian Woods and Waylon Wong delve into the reliability of one of the United States' most critical economic indicators: the monthly jobs report produced by the Bureau of Labor Statistics (BLS). This comprehensive analysis addresses recent challenges facing the integrity of this data, expert insights on safeguarding its accuracy, and the broader implications for policymakers and the economy.

1. The Latest Jobs Report: A Snapshot of the Labor Market

The episode opens with a presentation of the latest statistics from February's jobs report:

• 151,000 jobs added to the US economy.
• Unemployment rate edged up slightly to 4.1% from 4% in January.

Darian Woods emphasizes the significance of this report:
"The monthly jobs report is one of the major economic indicators that we rely on the government to produce. And generally, we trust that this data gives us an accurate snapshot of how US Workers are doing." (00:33)

2. Erosion of Trust in Government Data

Recent developments have cast doubt on the reliability of government-produced economic data. The episode highlights several alarming trends:

• Government Data Disappearances: Sensitive information has been vanishing from public websites.
• Unauthorized Access: Entities like Doge have reportedly gained access to confidential data.
• Disbanded Committees: Commerce Secretary Howard Lutnick has dissolved two advisory committees overseeing economic data integrity and proposed changes to GDP calculation methods.

Darian Woods brings attention to these issues:
"The monthly jobs report is one of the major economic indicators that we rely on the government to produce. And generally, we trust that this data gives us an accurate snapshot of how US Workers are doing." (00:33)

3. Expert Insights: Erika Groschen on Trust and Safeguards

To unpack these concerns, the podcast features Erika Groschen, a former commissioner of the BLS and a member of one of the disbanded committees. Groschen underscores the foundational role of trust in statistical agencies:

"If people don't trust the data, then you might as well not produce it." (01:26)

She elaborates on the robust safeguards in place to maintain data integrity:
"It's built into the directives on how you how the statistical agencies operate. It's built into the law. It's built into this great publication called Principles and Practices for a Statistical Agency." (04:06)

Groschen likens the safeguarding measures to everyday security practices:
"It's front and present all the time. Not because you're always fighting an active threat, but because everybody just knows that it's so important. The same way that people lock the door at night and do other things to make sure that they're warding off threats." (04:19)

4. Potential Manipulation of Data Releases

One of Groschen's primary concerns is the manipulation of data release schedules. Altering when data is released could allow for market manipulation, either by burying unfavorable news or prematurely announcing positive figures. Woods references a past incident to illustrate this risk:

"Like last year, a BLS data release didn't happen as scheduled. People from a couple investment banks then reportedly called the agency and got someone to tell them the numbers. This had other people in the market crying foul that some people got the information early and could potentially trade on it." (06:18)

Groschen warns against unauthorized individuals attempting to change data calculation methods, expressing fear that overconfident individuals might undermine established processes:
"I worry about hubris that some person who feels they're very smart may feel, gee, the BLS shouldn't be doing it that way. They may have all their explanations for why they do it that way. But I'm smart, and I think it should be done this way." (07:10)

5. Resource Constraints Threaten Data Quality

Another significant issue raised is the dwindling resources at the BLS. Since 2009, the Bureau's budget has shrunk by over 10% when adjusted for inflation. This reduction impacts both the quantity and quality of data collection:

• Fewer Staffers: Smaller teams struggle to maintain the same level of data collection and analysis.
• Declining Response Rates: Reduced participation can lead to smaller sample sizes, increasing the likelihood of errors.

Waylon Wong poignantly summarizes the consequences:
"Fewer people makes the job of collecting and analyzing survey data harder. And response rates for the surveys have already been declining. That's a problem because smaller sample sizes could lead to lower quality data with more errors." (08:00)

6. The Importance of Demographic Data

Elise Gould, a labor economist at the Economic Policy Institute, voices concerns about the availability of detailed demographic data:

• Missing Data on Poverty by Race: Gould notes that crucial data vanished from public records, only to be restored later.
• Implications for Research and Policy: Without access to unemployment rates segmented by gender or race, understanding the economic challenges faced by different groups becomes significantly harder.

Gould emphasizes the necessity of comprehensive data:
"What I look for in the labor market is how is it affecting workers and their families, and you want to know how that affects not just the average, but different groups of people. Race and ethnicity and gender are very key indicators to know how people are doing in the economy." (08:45)

7. Vigilance and the Culture of the BLS

Despite these challenges, both Groschen and Gould express confidence in the dedicated staffers at the BLS. Groschen asserts that vigilance is ingrained in the agency's culture:
"They can be undermined. It's like what parents tell their kids. Trust takes a long time to build up and it can be ruined in an instant." (09:42)

This steadfast commitment is crucial in maintaining the integrity and reliability of the jobs report, even as external pressures mount.

Conclusion: The Fragile Trust in Economic Data

The episode concludes on a cautionary note, highlighting the fragility of trust in government-produced economic data. With potential manipulation and resource cuts threatening the quality and accessibility of vital statistics, the integrity of the monthly jobs report stands at risk. As Woods aptly puts it:
"Trust takes a long time to build up and it can be ruined in an instant." (09:42)

For policymakers, investors, and the general public, safeguarding the accuracy and reliability of such data is paramount, as it underpins critical economic decisions that affect millions of lives.

Produced by: Angel Carreras
Engineered by: Gilly Moon
Fact-Checked by: Tyler Jones
Edited by: Cake and Cannon
Production: NPR