The U.S. Department of Labor is investigating a significant downward revision of employment numbers. The Federal Reserve: Data independence is crucial

The Zhitong Finance APP learned that the U.S. Department of Labor announced it would investigate recent data processing changes made by its Bureau of Labor Statistics (BLS). This move comes amid growing concerns about the reliability of government economic data, attracting widespread attention from the market and political circles. In a letter released on Wednesday, the Office of the Inspector General stated that the BLS recently made two notable decisions: one was to reduce data collection efforts for two key inflation reports, and the other was to announce a significant downward revision of employment data on Tuesday. These changes directly impact the economic data foundation that the market and policymakers heavily rely on. The Inspector General's office indicated that the investigation would focus on the challenges faced by the BLS in "collecting and publishing key economic data." The BLS is responsible for collecting and publishing various core economic indicators, including employment and inflation, and its data has traditionally been regarded as the standard by markets, businesses, and the government. However, this significant revision has shaken the market and raised concerns about potential political interference behind the data. The context for the investigation cannot be separated from President Trump's significant personnel decision last month. Trump dismissed the former BLS director and nominated economist E.J. Antoni from the far-right think tank "Heritage Foundation" to take over. This move has been criticized by many economists as "politicizing the BLS," undermining the agency's long-standing tradition of independence. Historically, the BLS has been largely free from interference by successive governments, serving as a relatively independent statistical agency providing objective data for policy and market decisions. However, as recent U.S. economic data has shown signs of slowing, Trump has increasingly expressed dissatisfaction with Federal Reserve policies and has pointed fingers at the BLS, accusing it of data manipulation. This series of actions is viewed as part of Trump's efforts to expand his influence over economic decision-making institutions. Shortly before Trump announced the dismissal of the BLS director, the Department of Labor had just released a weaker-than-expected employment report, which became the trigger. Trump's camp claimed the report data was manipulated, but critics argue that these accusations lack evidence. In response to public concerns, Federal Reserve Chairman Jerome Powell publicly emphasized the critical role of federal statistical agencies in policy-making. He stated, "Government data is the real standard. We need this data to remain high quality and trustworthy." Powell also pointed out that the Federal Reserve is still obtaining the data it needs to formulate its policies, while stressing the importance of ensuring statistical independence. Trump and some critics have focused their accusations on the BLS's regular data revisions. However, the economics community generally believes this is a long-standing and necessary practice, as short-term economic data collection is inherently complex and uncertain. For instance, the significant downward revision of employment data falls within the BLS's routine annual benchmark adjustment process. At the same time, the challenges faced by the BLS are increasing. Due to budget pressures and declining survey response rates, data collection efforts are becoming increasingly difficult. The BLS previously explained that the reduction in inflation data surveys was a necessary decision made due to limited existing budgets. Recent surveys by researchers have found that despite the decline in survey response rates, this has not significantly reduced the reliability of employment and inflation reports. Mainstream economists point out that although the latest employment data has been revised downward significantly, it remains within the normal range of fluctuations