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Frequent Downward Revisions Signal Potential Recession — Data Fabrication Poses Greater Threat

Photo by Chris Liverani / Unsplash

Following editorial direction to provide accessible analysis: Trump dismissed the Bureau of Labor Statistics director immediately after disappointing employment figures, alleging data manipulation. While external verification of such claims remains impossible, the magnitude of recent monthly revisions appears increasingly pronounced — warranting closer examination.

Monthly employment data undergoes revision up to twice in subsequent months following initial release, with comprehensive records maintained since 1979. The recently terminated director, appointed February 2024, oversaw revisions through May's data — encompassing 16 monthly adjustments. Net downward revision (final minus initial value) averaged at 30,000 positions, with standard deviation of 54,000. This compares closely with his predecessor's 16 revisions spanning October 2022 to January 2024: average downward revision of 26,000, standard deviation 50,000 — same after rounding.

KC Law (Economist)

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KC Law (Economist)

Law Ka Chung is a Hong Kong economist and financial columnist.

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