The CBO’s analysis of the Republicans’ “One Big, Beautiful Bill” is that it will add $2.4 trillion to the deficit over the next decade because the $1.2 trillion in spending cuts in the measure do not fully offset the $3.7 trillion in tax cuts for the wealthy and corporations. Republicans have met this CBO score with attacks on the CBO, but its estimate is in keeping with those of a wide range of economists and think tanks.
Just how these policies are affecting Americans is no longer clear, though. Matt Grossman of the Wall Street Journal reported today that economists no longer trust the accuracy of the government’s inflation data. Officials from the Bureau of Labor Statistics, which compiles a huge monthly survey of employment and costs, told economists that staffing shortages and a hiring freeze have forced them to cut back on their research and use less precise methods for figuring out price changes. Grossman reports that the bureau has also cut back on the number of places where it collects data and that the administration has gotten rid of committees of external experts that worked to improve government statistics.
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Labor Department says staffing shortages reduced its ability to conduct its massive monthly survey
Some economists question U.S. inflation data accuracy due to staffing shortages affecting survey precision.
The Bureau of Labor Statistics used less precise methods for guessing price changes in April’s inflation report due to hiring freeze.
Data issues could significantly affect economy, influencing Social Security benefits, bonds and Federal Reserve decisions.
Some economists are beginning to question the accuracy of recent U.S. inflation data after the federal government said staffing shortages hampered its ability to conduct a massive monthly survey.
The Bureau of Labor Statistics, the office that publishes the inflation rate, told outside economists this week that a hiring freeze at the agency was forcing the survey to cut back on the number of businesses where it checks prices. In last month’s inflation report, which examined prices in April, government statisticians had to use a less precise method for guessing price changes more extensively than they did in the past.
Economists say the staffing shortage raises questions about the quality of recent and coming inflation reports. There is no sign of an intentional effort to publish false or misleading statistics. But any problems with the data could have major implications for the economy.
The inflation rate determines how much Social Security benefits go up each year, and where federal tax brackets are set. Private-sector contracts such as wage agreements between companies and unions routinely reference the inflation rate. Payments on $2 trillion of inflation-protected federal bonds hinge on the inflation rate, as do yields on standard Treasury bonds. Businesses, investors and policymakers rely on the reading to guide their decisions. The Federal Reserve is laser-focused on inflation data when it sets interest rates for the country.
A handful of economists noticed quirks in the April data published May 13. When some asked the BLS for more information, government officials sent back an excerpt of an internal report.
“The CPI temporarily reduced the number of outlets and quotes it attempted to collect due to a staffing shortage in certain CPI cities,” beginning in April, the email read. “These procedures will be kept in place until the hiring freeze is lifted, and additional staff can be hired and trained.”
The Trump administration issued a hiring freeze on Jan. 20 for federal employees, and the Department of Government Efficiency, previously led by Elon Musk, cut thousands of federal workers through layoffs and buyouts. It couldn’t be determined if BLS employees were subject to those cuts.
The quality of U.S. economic statistics has been the envy of global policymakers for decades. The system is the product of concerted efforts that began in the depths of the Great Depression to better understand how the economy works.
For years, advocates have warned that government funding for economic statistics has been falling short. Concerns about data quality grew this year after the Trump administration disbanded committees of external experts convened to help improve government stats.
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Just hours after President Donald J. Trump posted on social media yesterday that “[b]ecause of Tariffs, our Economy is BOOMING!” a new report from the Organization for Economic Cooperation and Development (OECD) said the opposite. Founded in 1961, the OECD is a forum in which 38 market-based democracies cooperate to promote sustainable economic growth.
The OECD’s economic outlook reports that economic growth around the globe is slowing because of Trump’s trade war. It projects global growth slowing from 3.3% in 2024 to 2.9% in 2025 and 2026. That economic slowdown is concentrated primarily in the United States, Canada, Mexico, and China.
The OECD predicts that growth in the United States will decline from 2.8% in 2024 to 1.6% in 2025 and 1.5% in 2026.