Bureau of Labor Statistics:
"Temporarily Reducing Survey Scope
Due to Staffing Shortages"
Concerns have been raised that the accuracy of U.S. inflation statistics may decline as the federal agency responsible for these figures has reduced the scope of its data collection due to staffing shortages.
According to the Wall Street Journal (WSJ) on June 4 (local time), the U.S. Bureau of Labor Statistics (BLS) reduced the number of businesses included in its price surveys starting with the April Consumer Price Index (CPI) report, following a federal hiring freeze implemented during the Donald Trump administration.
The BLS deploys hundreds of surveyors each month to track changes in the prices of goods and services across the United States, using this information to calculate consumer price indicators. Most surveyors visit offline stores in person to check price tags for the targeted items or to obtain quotes for specific services.
If surveyors are unable to track the price of a targeted item, they estimate the price based on similar substitutes. Since the April report, the proportion of such estimated data has increased. Alan Detmeister, an economist at UBS, pointed out that in the April CPI data, approximately 29% of prices were filled in using this method.
In response to additional questions about the April CPI, the BLS stated, "We have temporarily reduced the number of retail outlets and price quote sources included in data collection, taking into account staffing shortages in certain cities." The agency added, "This will remain in place until the hiring freeze is lifted and we are able to hire and train additional staff." Last month, the Department of Labor announced in its April CPI report that the year-over-year increase in the index had slowed to 2.3%.
Economist Detmeister noted, "Reducing the sample size increases the sampling error," and added, "It is not yet clear whether this is a major problem, but it is certainly making the situation worse."
Meanwhile, the WSJ reported that it has not been confirmed whether the federal workforce reductions led by the Department of Government Efficiency (DOGE), previously headed by Tesla CEO Elon Musk, are directly related to the current situation.
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