The Labor Department's internal watchdog announced on Wednesday that it has initiated an investigation into the methods used by the Bureau of Labor Statistics (BLS) for collecting jobs and inflation data. This investigation by the department's Office of Inspector General (OIG) comes at a time when the BLS faces significant scrutiny from the Trump administration. The administration has highlighted recent downward revisions in employment data to question the credibility of the agency's statistics.
In August, President Donald Trump dismissed BLS Commissioner Erika McEntarfer, alleging that her motivations were politically driven, just hours after her agency released a disappointing monthly jobs report. The OIG operates independently, with its staff legally protected from any interference by the Labor Secretary or other political appointees. Currently, the office is led by acting Deputy Inspector General Michael Mikulka, as indicated on the Labor Department's official website.
In a letter sent on Wednesday morning, the OIG outlined its plan to review the challenges the BLS faces in collecting and reporting essential economic data. The decision to launch this probe follows BLS’s announcement of reduced data collection efforts for two critical inflation metrics: the Consumer Price Index (CPI) and the Producer Price Index (PPI). Additionally, the investigation is motivated by BLS's recent substantial downward revision of its job estimates in the monthly Employment Situation Report.
According to Assistant Inspector General for Audit Laura Nicolosi, the Labor Department released a preliminary report on Tuesday that revealed a dramatic downward revision of job data for the year ending March 2025, reflecting a loss of 911,000 jobs from earlier estimates. This revision marks the largest adjustment recorded in over two decades.
Nicolosi stated that the OIG's investigation will concentrate on two primary areas: (1) the challenges associated with collecting PPI and CPI data, and (2) the processes of collecting, reporting, and revising monthly employment data. The letter detailing these areas of focus was addressed to William Wiatrowski, who has been serving as the acting commissioner of the BLS since Trump terminated McEntarfer’s position on August 1, shortly after the release of a weaker-than-expected jobs report for July.
As this investigation unfolds, it will be crucial for the Labor Department to maintain transparency and restore public trust in the integrity of employment and inflation data, which are vital for economic planning and policy-making.
