MNI INTERVIEW: Mounting BLS Pressure Harmful For Data- Groshen

Data produced by the Bureau of Labor Statistics was already in increasing jeopardy even before the shock firing of the agency's commissioner following weaker-than-expected jobs numbers, and data quality could continue to suffer from the impacts of underinvestment, ex-BLS Commissioner Erica Groshen told MNI, expressing concern about perceptions of integrity under the next commissioner. 

"For the next few months, I am worried about the continued deterioration of the data because of the staff losses at BLS, the funding issues, and the restrictions on their spending money. Some chickens may come home to roost because they have staff losses in excess of 15% and that's a real problem," she said in an interview. 

Groshen is not yet worried about data manipulation through political influence, but she is concerned about how recent developments will affect data collection and the staff's own sense of mission.

"I worry about the impact of all that collateral damage that isn't aimed at the statistical agencies themselves, but is characteristic of what's going on and is really problematic for them. I do worry about a loss of morale in the agency," Groshen said. 

In the past few years, the BLS has faced tighter budgets and falling response rates to its surveys. In recent mon0ths, it has faced staff shortages brought on by a hiring freeze the President declared in January. The agency’s budget has shrunk in inflation-adjusted terms over the past decade, even as the cost of collecting economic data has risen. From fiscal year 2016 to 2024, for instance, the BLS budget rose about 16%, while inflation climbed twice as fast. (See: MNI INTERVIEW: US Data Already Suffering From Underinvestment) 

MORE OF A CHALLENGE 

President Trump’s decision to fire the head of the BLS on Friday will further strain the agency and it will only make the job harder for the next commissioner. 

The next "commissioner, no matter what, will come into the job facing more of a challenge than normal, because people will worry about the criteria used to select the person and whether there is some commitment on the part of the commissioner to try and manipulate the data," she said. "That hasn't been the case with people who have become commissioners before."

"What I'm not worried about right away is direct manipulation," she said. Groshen praised Acting Commissioner Bill Wiatrowski, who she promoted to Deputy Commissioner in 2015. "He will do a fine job, as good a job as can be done under those circumstances. And I don't worry about him allowing any kind of manipulation or any of that sort."

GROUNDS FOR CONCERN

"However, if you've got a new commissioner who comes in with some kind of group of other political appointees, and they start changing the norms and the practices of BLS, then there would be serious grounds for concern," said Groshen, who ran the agency from 2013 to 2017. (See: MNI INTERVIEW: Ex-Chief Says BLS Can Withstand Trump Pressure) 

"If that Commissioner actually wants to try to manipulate the data, they are going to run into the fact that the process is not set up to allow manipulation of the data. They would have to fundamentally change how the data are prepared and the pre-release steps for those programs," she said. "That would be very noticeable to the staff and they would I'm sure resist doing that. You could get resignations, whistleblowers, that sort of thing."

To determine whether the next commissioner is heading in the wrong direction, Groshen will be looking to see whether that person includes the commissioner actually having a role in finalizing the numbers, having sign off from the Secretary of Labor or the White House before there's a final release, or delaying or speeding up data releases.

Groshen said Friday's jobs report showed big revisions, "but they were not way out of line," she said. "That happens and it tends to happen more around inflection points, turning points in the business cycle." A lot of it appears to have something to do with state and local education jobs, who usually report late. "Seasonal changes were also a little bit larger than normal."