On Friday morning, financial reporters, market participants, economists, and policy makers will gather around televisions and monitor digital news in breathless anticipation of the Bureau of Labor Statistics' 8:30 am release of the monthly jobs report — non-farm payrolls (NFP), for those in the know.
Generally released on the first Friday of every month, it's been called the "mother of all economic data," and, without a doubt, it's the most highly anticipated and scrutinized economic report released by the federal government. This month, like most months, we'll be analyzing the jobs report to try to divine the next course of action for the Federal Reserve. Will a weak jobs report stave off interest-rate hikes? Will a strong report encourage the Fed to make a move in September?
In fact, the report is one of the most closely held data points in government ahead of its public release, available only to the Federal Reserve chair, the Treasury Secretary, and the chairman of the president's Council of Economic Advisors.
The report provides a snapshot answer to two of the most important questions for businesses, investors, and government economic officials: (1) How many people are working? (2) Are they earning enough money to buy stuff?
The answers to those questions are so important and useful, I find myself wondering, Why wait? Why the drama?
Why should the rate of job creation in the U.S. economy be any more or less mysterious than the exchange rate of the dollar, the yield on a 10-year note, or frozen concentrated orange juice?
Why wait with breathless anticipation for the result of a poll?
Well, two polls, actually. A household survey asks people about the nature of their work (or lack of work) over the previous month. This is how we estimate the unemployment rate. The second poll, an establishment survey, asks firms if they've hired over the past month. From these results, the BLS models an estimate for net job creation for the month.
Admittedly, these are very precise polls, seeking specific answers to carefully crafted questions. And they're very large polls. The household survey reaches 60,000 respondents each month, while the establishment survey interviews more than 140,000 businesses and government agencies.
And the polls are also subject to sophisticated modeling by the BLS to perfect their estimates. For example, the raw data is adjusted to account for seasonal hiring factors and the weather.
But these are not obstacles to more regular reporting of the data. There is simply no compelling reason that employment data can't be available in something closer to real time – even daily. I could imagine a simple ticker on the BLS website that updates every morning with new data. Changes would be small on a day-to-day basis. This would have the benefit fewer surprises among market participants and policy makers. Even the unadjusted raw data could have value for third-party analysis.
Economic agencies should seek to report as much data as possible in the most timely manner in order to deliver the best information to decision-makers. Arbitrary delays, whether due to old processes or old technology, don't make sense today.
Let me be clear: I love the drama of these Friday morning jobs day events. But the government shouldn't be in the business of providing drama. It should be focused on providing citizens, market actors, and policy makers with the best — and most timely data available. Let's end the monthly drama and make every day jobs day.
Commentary by Tony Fratto, managing partner at Hamilton Place Strategies, a strategic communications and crisis management consultancy based in Washington, DC. Prior to that, he was deputy assistant to the president and deputy press secretary to President George W. Bush from September 2006 to January 2009. Follow him on Twitter @TonyFratto.