Tag: monthly jobs report
Trump 's Economy Is Losing Jobs, So He Wants A New Scorekeeper

Trump 's Economy Is Losing Jobs, So He Wants A New Scorekeeper

When a football team has keeps losing, the cry usually goes out for a new coach, or at least a new quarterback. Alternatively, there is the Trump route: get a new scorekeeper.

That is apparently the story, with Trump reportedly looking to overhaul the Bureau of Labor Statistics (BLS). BLS is the statistical agency that tells us how many jobs we create each month. It tells us the unemployment rate. It also tells us the inflation rate.

Trump’s import taxes (tariffs), mass deportations, and cuts to healthcare and other government programs have whacked the economy with a sledgehammer. As a result, these numbers have looked very bad in recent months. Rather than trying to address the economic problems he created, Trump is looking to ransack BLS and install lying hacks who will tell us the economy is GREAT!

We’ll probably get the specific plans this week, but Trump already fired his first shot in this battle in his war against reality last month. He fired BLS Commissioner Erika Mcfartner after a bad jobs report for July, absurdly claiming that she had somehow rigged the numbers to make him look bad. Trump’s economic team then rushed in to lie about the lie and claim Trump was concerned about inaccuracy, not rigging.

The Problem is Trump, not the Bureau of Labor Statistics

It is not the scorekeepers’ fault when the quarterback keeps throwing interceptions, but that is the way Donald Trump plays football. The stalling economy is not a surprise to those of us who have paid close attention.

Since Trump came into office he has hit the economy with massive taxes in the form of hundreds of billions of dollars of tariffs. This is money coming out of the pockets of families and businesses. It doesn’t take an advanced degree in economics to know this will slow growth.

Making matters worse, he has imposed his tariffs like a reality TV show, promising higher tariffs or lower tariffs on some deadline, and then changing the dates and/or the threatened tariff rate. Reality TV show stars don’t have to make plans, businesses do. Ever changing tariff rates do not create a good investment climate. As a result, businesses are putting off investment and hiring decisions.

Trump’s erratic budget cuts, starting with Dark MAGA Elon and the DOGE boys, made matters worse. They cut employees and agencies in haphazard ways, both pulling money out of the economy and leaving some, like the FEMA and the FAA, ill-prepared to do their jobs. In addition, the budget cuts to healthcare in Trump’s “beautiful bill” are already forcing hospitals and other providers to lay off staff or even close altogether.

And mass deportation is preventing construction from moving forward in many areas and forcing farmers to leave crops rotting in the fields. Less output and higher prices are inevitable results.

So, a weak economy with rising unemployment and higher prices is hardly a surprise. But Trump refuses to fix or even acknowledge the problem. Instead, he reports that Putin told him the economy is booming. Trump insists the problem is with the scorekeeper.

Wrecking BLS Is Not Funny

The idea of ransacking a statistical agency, known for producing gold standard data for more than 100 years, may seem a silly concern of economics nerds, but it has very real-world consequences. It not only will make it more difficult for anyone to know how fast the economy is growing or how many jobs are being created; it makes it more difficult for businesses to operate and plan for the future. If we have statistical agencies that report the numbers Trump tells them to report, rather than what is actually happening in the economy, businesses will be cutting back investment here and looking to instead put their money in countries that don’t lie about their data.

Trump’s games with economic statistics will also affect us all directly in our pocketbooks. Social Security benefits increase each year in step with inflation, as measured by the Consumer Price Index (CPI) produced by BLS. If Trump tells his lackeys to reduce the CPI by 1.0 percentage point, that means everyone will get 1.0 percent less in their Social Security check each month.

And this impact is cumulative. If Trump orders a 1.0 percentage point reduction in the CPI every year, then after two years, Social Security benefits will be 2.0 percent lower, after three years, benefits will be 3 percent lower, and after ten years they will be 10.0 percent lower.

The CPI also affects tax brackets, which are also indexed to inflation. As a result of Trump’s gaming, tens of millions of families will find that more of their income is in a higher tax bracket, meaning they will pay more in taxes. There is real money at stake in economic data.

We Need to Deal with Reality, not Trump’s Alternative Universe

Trump’s economic policies are imposing huge costs on tens of millions of people. He will make matters much worse if he wrecks BLS and other government statistical agencies to make it harder for us to know exactly how much worse. Hiding the truth may make it easier for Trump to run around saying “GREATEST ECONOMY EVER!” but it will make life much more difficult for those not living in Trump’s circle of grift.

Dean Baker is a senior economist at the Center for Economic and Policy Research and the author of the 2016 book “Rigged: How Globalization and the Rules of the Modern Economy Were Structured to Make the Rich Richer.” A version of this column originally appeared on his Substack site.

Economy Soars While Media Repeats Jobs 'Expectations' Narrative

Economy Soars While Media Repeats Jobs 'Expectations' Narrative

Reprinted with permission from PressRun

The U.S. economy just set the record for the most jobs created in one year, but you’d never know it from the continuing doomsday economic coverage under President Joe Biden.

The new jobs report, released last Friday, offered the latest evidence of the purposeful disconnect the media maintain, and specifically how journalists rely on consistently unreliable “expectations” for job report numbers in order to portray the results as “disappointing,” and to paint a picture of a faltering U.S. economy even as it shatters growth records.

The U.S. economy just posted 199,000 new jobs in December, during a pandemic surge. That sounds like a good thing, right? Especially considering that in December 2020, under Trump and during another wintertime pandemic surge, the U.S. lost 140,000 jobs. Instead, the press was uniformly pessimistic about Friday’s news.

It was a “major disappointment,” CNN announced, despite the fact employee wages hit record heights and the unemployment rate tumbled to 3.9 percent. (Last winter, the CBO predicted it would take five years for the U.S. to reach an unemployment rate that low.) NPR stressed the US added “only” 199,000 jobs. Hiring had “faltered” the New York Times reported. All because the key number failed to meet estimates.

The expectations game is set by economists and banks which publish their estimates on the eve of each job survey. It’s an easy-to-use model the press has employed for decades to analyze monthly results. But economists’ expectations no longer work during the pandemic. They’ve been wildly inaccurate during the Biden recovery and should no longer serve as the determining factor in how jobs reports are presented by the press.

“During one of the most volatile periods in recent memory, private and public-sector economists have a less firm grasp of what the labor market is doing,” the Wall Street Journal recently conceded. During 2021, economists cumulatively missed the jobs mark by well over 1 million jobs. And that’s in a year when the U.S. created more than 6 million jobs, the most since records began in 1939.

The expectations model often produces dubious journalism. When last November’s job report was released, NPR quickly announced it was a “bust” because just 210,000 jobs had been created. But back in January of 2020, NPR cheered that the U.S. economy was “revved up” because 225,000 positions had been added.

Why the drastically different NPR spin for the Biden and Trump years? Expectations. Trump’s 225,000 job gains surpassed that month’s modest expectations, while Biden’s 210,000 fell short of estimates.

Another key hurdle is that the government has shown for the last year that it chronically undercounts, by large margins, the job gains data that are released to the public, and when it goes back and quietly post revisions they’re mostly ignored by the media.

August was a perfect example. That month’s initial jobs report claimed 235,000 jobs were added, which prompted lots of “disappointing” news coverage based on the established expectations. That total was soon revised all the way up to 483,000 new jobs, a development that received little press attention. Look at last September. The initial report announced 194,000 jobs. (“Lackluster,” announced NBC News.) After two revisions, the job total nearly doubled to 379,000.

Why the big revisions lately? Each month, the Bureau of Labor Statistics surveys 145,000 employers, extrapolates data, and produces an initial estimate of monthly job gains or losses. Lots of employers don’t initially reply, so the BLS goes back a second time, which produces the revised number. The problem is that during the pandemic, the percentage of employers who are responding to the survey has dropped dramatically, which means the initial numbers are less reliable. Yet those numbers are still the ones the press blasts out in headlines the first Friday of every month, when the unemployment figures are released.

It’s a one-two combo: The BLS is regularly undercounting jobs, which is bad news for the White House, and economists are regularly overestimating what the monthly BLS jobs number will be, which is also bad news for the White House. Then when the BLS revises the monthly gains, the media are nowhere to be found.

Wash, rinse, repeat.

That means Biden just oversaw a stunning jobs-creation year, while consumers were constantly fed headlines about “disappointing” jobs reports because the initial reports didn’t align with skewed “expectations.”

There’s also the lingering suspicion that the press simply likes to tell bad economic news — and hide upbeat newsflashes — during the Biden years. Just look at this pretzel-logic headline from the Washington Post on January 9, “2021 Shattered Job Market Records, But It’s Not as Good as it Looks.”

When last summer’s blockbuster July jobs report showed a jaw-dropping gain of nearly one million jobs, “NBC Nightly News” completely ignored the development. NBC did the same thing for the October survey, which announced a robust 531,000 jobs. It certainly feels like there’s a preferred media narrative in play.

The current approach for how the press handles monthly jobs reports isn’t functioning as it should. So why do journalists stick to the broken model?

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