Trump fired BLS head Erika McEntarfer and claimed July’s jobs report was rigged without proof

Wall Street investors are cutting their reliance on government job data after Donald Trump accused the BLS of faking July’s labor numbers and fired the agency’s head, Erika McEntarfer. The blow came fast.

Trump made the claim with no evidence, but the damage didn’t need proof. According to data from Bloomberg, the firing shook long-standing confidence in what used to be seen as the most neutral set of economic numbers in the U.S.

Philip Petursson, chief investment strategist at IG Wealth Management, said he’s used BLS data for decades, not as the only input, but definitely one of the key ones. Now he doesn’t trust it the same way.

Philip said, “It calls into question the validity going forward,” and added that if the numbers get political, “you can’t rely on them, and you’re going to have to rely on everything else.” That feeling isn’t just his anymore. Others on Wall Street are saying the same thing, out loud.

Wall Street leans harder on private data firms

Michael O’Rourke, chief market strategist at Jonestrading, said flatly, “The optics of this situation are not very good.” He said he’ll be giving “more emphasis” to employment reports from ADP Research and pulling back from BLS releases.

That’s becoming the pattern. Reports from private companies like ADP, Challenger, Gray & Christmas, Institute for Supply Management, and S&P Global are no longer just extra data—they’re becoming central.

Brian Jacobsen, chief economist at Annex Wealth Management, said private data has become the “check and balance to the public data.” He’s watching Senate confirmation hearings to see if Trump’s pick to lead the BLS will change how the numbers are put together.

Brian said he’ll wait to judge the nominee but warned, “If it becomes politicized, we’d notice it pretty quickly.” He also pointed out that private reports let analysts spot mistakes.

So far, the stock market hasn’t gone haywire over Trump’s moves, but it’s clear that trust is fading. Keith Lerner, co-chief investment officer at Truist Advisory Services, said that less trust in data could mean investors want higher risk premiums.

That would drag down valuations and make data feel shakier. “If you have less confidence in it, then you probably on the margin have maybe a higher risk premium,” Keith said.

Old BLS issues add to the fallout

The BLS had problems long before Trump stepped in. The agency’s budget has been tight for years. It’s lost staff. It’s still using outdated methods. People aren’t answering their surveys like they used to. That’s made the data more incomplete, and the revisions are getting bigger.

Sometimes they even have to make up missing data points, filling gaps with guesses. That’s been the case for years. But people put up with it because they believed the BLS wasn’t being influenced by politics. That belief is now cracking.

Julian Emanuel, chief equity and quantitative strategist at Evercore ISI, said attention is growing fast around private sources. His firm also publishes labor market numbers. “The move toward private data is getting increasingly greater focus as the data from the government increasingly becomes a question mark,” he said.

Donald Ellenberger, senior portfolio manager at Federated Hermes, warned that the White House’s actions could permanently damage government data. “The usefulness of government reports will diminish” if people think the Trump administration is interfering. And he didn’t stop there. “Trust is the cornerstone of finance,” Donald said. “Once lost, it is hard to replace.”

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