Several prominent economists are criticizing lawmaker plans to slash funding for the agency that collects economic statistics, saying it could undermine the “gold standard” for economic data.
In a letter sent to Congress, 63 economists from across the political spectrum said proposed cuts would hamper the Bureau of Labor Statistics (BLS), whose reports provide critical economic insight relied on by key government agencies and major businesses worldwide.
“The very nature of work in the U.S. economy is changing,” the economists wrote. “Now is not the time to cut funding for the main institution charged with tracking these changes.”
The letter, helmed by the Economic Innovation Group, was signed by several prominent economists from the left and the right. Among the signers were Austan Goolsbee, former head of the Council of Economic Advisers under President Obama, and Glenn Hubbard, the Columbia University economist that was a strong candidate to serve as Fed Chairman had Republican presidential nominee Mitt Romney won the 2012 presidential election.
Specifically, the group is pushing back against a Senate appropriations package that proposes cutting funding for the BLS to $515 million from its 2015 level of $527 million. The White House pushed for a significant increase for the agency, to $567 million, in its most recent budget.
House appropriations legislation would boost BLS funding to $544 million, but the economists said that amount would still come up well short of necessary funding, especially after the agency faced funding shortfalls for the last five years.
The BLS puts together the official government reports on the economy, most notably the monthly jobs report that sets the nation’s unemployment rate.
The economists argued that, now more than ever, the agency needs robust funding given the transitional phase of the U.S. economy. The rise of technology, globalization and employment trends brought on by the “gig” economy require a keen government eye to help policymakers, they said.
And while there are some private sector reports, like a monthly jobs report from the payroll company ADP, those reports are more narrow and still are benchmarked against government findings. Only the BLS has the mandate and ability to gather the data necessary to paint a clear picture of the overall labor market, the economists wrote.