Trump fires top economic data official as tariffs send markets plunging

2025-08-02 09:18:00, Kosova & Bota CNA

US President Donald Trump has fired the head of one of America's most important economic institutions, hours after weaker-than-expected jobs data sparked further alarm about his tariff policy.

On social media, Trump claimed - without any evidence - that Erika McEntire, commissioner of the Bureau of Labor Statistics (BLS), had "MANIFESTED" the jobs figures "to make Republicans and me look bad."

US stock markets fell sharply after the unprecedented action by the White House, with some accusing Trump of destroying public trust by politicizing the data.

Senate Minority Leader Chuck Schumer said the president was "a bad leader" who "shoots the messenger" over poor statistics.

Markets were shaken on Friday after Trump pressed ahead with his plans to lift U.S. import tariffs on countries around the world.

Figures were then released by the BLS showing that employers in the US added just 73,000 jobs in July, well below forecasts for 109,000 new jobs.

It also revised employment growth downward in May and June, reporting 250,000 fewer jobs than previously thought.

Trump insisted: "The economy is booming under 'TRUMP.'"

But Heather Long, chief economist at Navy Federal Credit Union, said the employment figures were a "game changer," adding that "the job market is deteriorating rapidly" due to uncertainty caused by Trump's tariffs.

Trump has dismissed concerns about his tariff plans, which he says will boost US manufacturing and rebalance global trade.

But this week's data and a series of updates from companies on tariff costs have made these predictions harder to ignore.

Regarding the decision to fire McEntire, former US Treasury Secretary Larry Summers said: "Firing the head of a key government agency because you don't like the numbers they report, which come from surveys that use long-established procedures, is what happens in authoritarian countries, not in democratic ones."

Friends of the BLS, a group whose members include two former commissioners of the agency, said: "When leaders of other nations have politicized economic data, it has destroyed public confidence in all official statistics and in government science."

McEntarfer called her time as commissioner "the honor of my life," while describing the agency's work as "vital and important."

The major stock market indexes all closed sharply lower on Friday.

Trump has attacked key economic figures in the past, most recently Jerome Powell, chairman of the US Federal Reserve, as the central bank continues to keep interest rates unchanged.

Trump is demanding a reduction in tariffs, but the Federal Reserve is keeping quiet until it sees the full impact of the tariffs on the US economy.

After the jobs report, Trump launched a further barrage at Powell, declaring that he too "should be put out to pasture."

A member of the Federal Reserve's interest rate-setting committee, Adriana Kugler, is resigning, giving Trump an opportunity to appoint someone new.

The head of the Labor Department, which oversees the BLS, wrote on social media that the agency's deputy commissioner, William Wiatrowski, would take over the role while the search for a replacement is underway.

The Labor Department did not immediately respond to a request for comment.

The BLS revises job numbers each month as new data comes in, typically adding or subtracting tens of thousands of positions.

Although this month's changes were significantly larger than usual, analysts said the updates were consistent with other data showing a slowdown.

Some speculated that they could reflect a blow to small businesses, which are typically slower to respond to surveys and are particularly sensitive to tariffs.

"Revisions are normal," Mr. Sweet said. "They're trying to do this right."

McEntarfer had worked for the government for more than 20 years before being nominated to lead the BLS in 2023. She was later confirmed almost unanimously by the U.S. Senate.

Michael Strain, director of economic policy studies at the right-leaning American Enterprise Institute, defended Ms. Entarfer, saying she had behaved with "great integrity."

"It is imperative that decision-makers understand that government statistics are unbiased and of the highest quality. By casting doubt on this, the President is harming the United States," he wrote on social media.

Jed Kolko, a senior fellow at the Peterson Institute for International Economics, said the firing raised serious alarm.

"For six months, I have said that threats to economic data have been more collateral damage than intentional harm. No more. The firing of the head of the BLS is intentional harm with five alarms to the integrity of US economic data and the entire statistical system," he wrote on social media.

Trump defended the decision and said her removal was necessary to ensure there were "people we can trust" in these positions.

"Why should anyone trust the numbers?" the president told reporters as he left the White House on Friday.

"I believe the numbers were fake, just like they were before the election, and there were other cases - so you know what I did? I fired him, and you know what I did? The right thing."

fees

The data debate comes as Trump redefines trade policy, hitting goods from countries around the world with new tariffs ranging from 10% to 50%.

When Trump unveiled similar plans in April, U.S. stocks fell more than 10% in a week, as concerns spread to the dollar and bond markets.

The stock market recovered after he suspended some of the most drastic measures, leaving in place a less punitive and more expected 10% tax. In recent weeks, US indices have traded around historic highs.

The latest measures are less extreme than those Trump first proposed in April, but they will bring the average tariff rate to roughly 17%, up from less than 2.5% at the start of the year.

"The reality is that Trump was encouraged by the fact that the markets came back immediately," Michael Gayed, a portfolio manager for The Free Markets ETF, told the BBC's Opening Bell. "Now he's going to try his luck again."/ CNA