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0:15

This is Planet Money from

0:18

NPR.

0:21

When someone says the economy

0:24

is doing well, what does

0:26

that even mean? For workers?

0:29

Or for employers? Or

0:31

an average of the country as a whole? Is

0:33

the objective here to tame inflation?

0:36

Or is it to lower unemployment? Or to

0:38

have less inequality?

0:40

Is it some of these things? Is it none of these

0:42

things? Or a mix of all of the above?

0:47

Hello and welcome to Planet Money, I'm Darian Woods.

0:50

The world of economics is filled with

0:52

all sorts of measuring sticks. And

0:54

over time, all kinds of government agencies

0:57

and universities and even private

0:59

companies have come up with different ways

1:02

to measure slices of the economy. And

1:04

we pay attention to these measurements because

1:07

they go into all kinds of huge

1:09

decisions. Things like government policies,

1:11

but also personal investments. So

1:14

today on the show, we're going to lift the curtain on

1:16

two of these yardsticks. We're

1:19

going to meet the people behind the inflation

1:21

and jobs numbers and see how

1:23

the ruler gets made.

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2:27

Our first metric for the economy comes from host

2:29

Stacey Vanek Smith, and this one's about

2:31

inflation, the big worry of the last

2:33

few years.

2:34

Inflation is just a fancy name

2:37

for prices going up. And if

2:39

prices start going up at a really fast

2:41

pace, it can signal the beginning of

2:43

a so-called inflationary spiral. That

2:46

means prices going up out of control. So like

2:48

your latte goes from $4 to $10 to $50.

2:51

That can cause enormous destruction

2:53

to an economy. And of course, to the savings of

2:55

millions and millions of people. It's

2:58

one of the most important

2:59

indicators for any economy. It's

3:03

measured using something called the Consumer Price Index,

3:05

the CPI, which is a measure of the price of everything we

3:07

buy. The

3:11

process of calculating CPI is meticulous. It's labor

3:13

intensive. It involves hundreds of people.

3:16

It's also top secret. These

3:20

data are closely guarded because

3:22

they need to be above suspicion and tampering.

3:25

But the Bureau of Labor Statistics agreed

3:27

to let us tag along for half a day.

3:29

Yes, they did. All I had to do was sign

3:31

like eight non-disclosure

3:32

agreements. But

3:35

totally worth it. To get the inflation

3:37

number every month, millions of data

3:40

points are involved, gathered by around 450 dedicated

3:42

workers.

3:44

Hi, my name is Emily Macytas, and

3:46

I am an economist with the United States Department

3:48

of Labor, Bureau of Labor Statistics. Every

3:51

month, Emily and her colleagues go on

3:53

a hunt, a hunt for inflation.

3:56

To do this, they track the price of, well,

3:59

just about. all along.

4:01

Rents, hair cuts, trucks, toasters,

4:04

raincoats, boxes

4:04

of wine, burgers to go, weddings, funerals,

4:07

yoga pants. And my favorite thing

4:09

is we follow prices on pretty

4:11

much everything that is legal in the country.

4:15

This is a huge

4:16

job and it starts with

4:18

surveys taken by thousands of households,

4:21

just everyday people all across the country

4:23

who write down in really minute

4:25

detail how they spend their money.

4:27

Also they'll write down something like, you know, I

4:29

bought butter at the store. And then

4:32

inflation watchers like Emily will find,

4:34

you know, a particular brand of butter at

4:36

a particular store and they will

4:39

track the price of it for years.

4:41

Everything has a code. Salted

4:44

butter has one code. Unsalted butter has

4:46

a different code. Butter and sticks, different

4:48

code. Organic butter, that's also

4:51

different. And this is true for every consumer

4:53

product in the US.

4:55

We have a 600 page manual for a reason.

4:59

Really? It's 600 pages. Have you read it? There

5:01

is a lot I have. Really? Every page?

5:03

There is a lot to learn. I have.

5:06

Yep. Wow. To check these

5:08

prices, trackers like Emily used to drive around to

5:10

stores, find a particular tub

5:12

of unsalted butter or a 100% wool

5:15

boat neck sweater in size eight and

5:17

look at the price tag for that particular

5:20

item. And then come back to that

5:22

store to look at that same item month

5:24

after month, which sounds really

5:27

kind of old school and needlessly

5:29

labor intensive. But this data

5:32

is just that important. It

5:34

has to be accurate. Of

5:35

course, COVID changed everything. In-person

5:38

was no longer an option. So now instead

5:40

of walking into stores and checking price

5:42

tags, now Emily's day is

5:45

a lot of this. Mr.

5:47

Horace,

5:47

this is Emily Masaitis calling with the Bureau

5:49

of Labor Statistics. How are you doing today?

5:52

Hi. Everyone calls, dozens a day.

5:54

First up, a sporting goods store in Delaware.

5:57

So we are just doing the consumer price index.

5:59

update

6:01

on our pair of

6:03

socks. Of course, Darien, I cannot reveal

6:05

the brand of socks because I signed

6:08

a non-disclosure agreement, it's confidential.

6:10

But these are white athletic socks. Of course,

6:13

they are not just any white athletic socks

6:15

though. Just verifying some specifics

6:18

on the item, it's knee length,

6:20

is that correct?

6:21

Yes.

6:22

And then I have that it

6:24

is 85% acrylic and 15% nylon. Yes.

6:29

Okay, great. And I have that it has moisture wicking,

6:31

is that correct? Yeah, repels moisture.

6:33

Okay, great. Emily makes a note

6:36

of all of this, she gets to the right code

6:38

and now the moment is here,

6:41

the price. So they're $799. $799 for

6:43

the

6:44

socks. Turns

6:46

out the price hasn't changed since last

6:48

month.

6:49

So the sock indicator, Darien, telling us inflation

6:52

isn't happening. But that is just

6:54

one product in one store. And

6:56

you cannot measure inflation using just one

6:59

pair of socks. And Emily

7:01

has at least 30 more price

7:03

checks ahead of her today.

7:04

And it's not just products like socks, the

7:06

consumer price index tracks services too.

7:09

Haircuts, car repair, work out classes.

7:12

Daycare. In this case, the weekly rate

7:14

for a two year

7:15

old at a daycare in Philadelphia.

7:18

So this one Emily

7:19

checks the price on the daycare website.

7:21

She does a lot of that these days. So

7:23

I have older toddlers here

7:25

and the weekly full time tuition

7:27

is $320. That

7:32

changed. $306, so inflation

7:34

in action. Inflation in action.

7:37

The price of daycare is up 5%, about $14 a week. And

7:39

that adds up, it's around $700 a year. So

7:41

there it is. We've seen

7:44

some evidence

7:47

of the dreaded inflation.

7:48

Yes. As you can imagine, Darien, I got

7:50

very worked up about this. I

7:52

was like, here it is, inflation in the flesh.

7:55

And Emily was like, okay, like, let's

7:58

look at a few more prices. Let's make some more calls. So

8:01

she let me tag along to a couple more phone calls including

8:03

to a little corner store in Philadelphia to

8:06

check the price of

8:08

butter. It's butter. It's not that exciting.

8:13

We will be the judge of that. I am

8:15

just calling to do our monthly

8:17

check on butter for the consumer price index.

8:20

Specifically

8:20

a box of four sticks

8:22

and salted. Four thirty five.

8:25

Four thirty five? Yes

8:27

ma'am. Okay so that's one up 25 percent. It

8:30

looks like the last time it was $3.49. Do

8:34

you happen to know why it's increased so much?

8:36

See butter is exciting.

8:38

But Emily gets very focused

8:41

here because this is potentially a really

8:43

big moment in the inflation hunt. A

8:45

price rising by that much

8:48

actually requires filling out a special

8:50

form. I mean it could be evidence

8:53

of spiraling inflation.

8:54

But Emily's been doing this for years

8:56

and her spidey sense is going off. So

8:58

before she fills out that special form she

9:01

asks the store owner to double check the price

9:03

of that butter. The store owner

9:04

puts the phone down. We wait for a minute.

9:07

Comes back on. Okay so it's not $4.35 right

9:09

now?

9:10

No it's $2.50.

9:12

So it turns out he was looking at the wrong

9:14

brand of butter. And in fact the particular

9:16

butter Emily's been tracking is part

9:18

of a promotion this week. Two for five

9:20

dollars. So one package costs $2.50

9:23

which is actually less than it cost last

9:25

month. Okay. I was going to say that's

9:27

a huge increase for butter huh? And you're

9:29

stuck up on it. I'm

9:31

glad you took the time to look that up for me. I

9:34

appreciate it.

9:35

This is why Emily does what she does.

9:38

Why there's a fleet of people like

9:40

Emily who check the details. These

9:42

details matter. The inflation rate,

9:45

it influences markets. It's got

9:47

policy makers issuing statements. It

9:49

even affects the price of gold. And

9:52

that number comes down to this. A

9:54

woman calling a supermarket in Philadelphia

9:56

to check the price of butter and then

9:58

double checking to... make sure the data

10:01

is right. After

10:03

the break, behind

10:05

the scenes of the jobs numbers.

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12:16

Our second indicator for the economy today

12:18

is job growth. Host Weyla

12:20

Wang joins me to tell you about jobs

12:22

numbers. Jobs

12:24

growth is one of our favorite economic

12:26

indicators. It's this really direct

12:28

measure of how the economy is going

12:30

in a way that has this tangible,

12:33

wide-reaching effect on everyday

12:35

people. Host And like all superfans,

12:37

we love going behind the scenes.

12:40

We want to go backstage to the economic

12:42

statistics green rooms and eavesdrop

12:45

on the spectacle heroes entering numbers

12:47

into databases. Earlier,

12:49

we sat in on how price inflation data

12:51

was collected, and now we're going

12:53

to learn about how jobs numbers are put together.

12:56

There are two main surveys that go into

12:58

the monthly jobs report, one that

13:01

surveys households for things like unemployment,

13:04

and there's a second survey of businesses

13:06

and government agencies. This one's

13:08

called the establishment survey, and

13:10

it's where you get the jobs numbers, that X

13:13

number of jobs get added to the economy

13:15

any given month. Every

13:17

month, the establishment survey interviews

13:20

about 130,000 employers. It covers about a third of all

13:22

non-farm workers in the

13:26

country. Some employers complete the

13:28

survey online, but a lot

13:31

of it is done the old-fashioned way, over the phone. Erica

13:33

Hennion, US Department of Labor

13:34

Hi, Darian. It's Erica Hennion with the US

13:36

Department of Labor. How are you doing this afternoon?

13:38

Darian

13:38

I'm doing very well. How are you today?

13:41

Erica Hennion

13:42

is an agent for the Bureau of Labor

13:44

Statistics in the Department of Labor. She

13:46

is one of about 300 people working

13:49

the phones to paint that big picture of

13:51

jobs in America. Erica used

13:53

to work as a bakery manager, so she's

13:55

no stranger to chatting with people. Erica Hennion,

13:58

US Department of Labor And I will let you repeat that to my mother. She's a hair So

14:00

she's been a

14:02

person who's always talked to people. And

14:04

so I've just been around that. I mean, hairdressers

14:06

know everything, Weyland.

14:07

Yeah, they do. I mean, I have spilled many a

14:09

secret to my hairdresser. And this chit-chatting

14:12

is really important because when

14:15

we spoke, Erica was aiming to make 400 calls

14:18

for the month with people who don't necessarily

14:20

want to answer them. It gets stressful towards

14:22

the end because you're like, I want to make those numbers. A

14:24

lot of businesses, when they call

14:27

and we talk to them, they're not going to do it because it's

14:29

not mandatory. The more people who pick

14:31

up the phone, the more comprehensive the survey

14:33

is. And the more accurate the Jobs

14:35

Friday numbers will be. While

14:37

I'm on the line, Erica calls up a professional

14:40

employer organization in Arizona. This

14:43

is a kind of company that shares hiring

14:45

with small businesses.

14:48

It's Erica with the US Department of Labor.

14:51

How are you doing today? Doing good. I

14:53

think I just know your voice by now when you call. I

14:55

know. It's been a while for

14:57

us. The way the survey works is that the

14:59

same business will get a call each month for

15:01

anywhere between two and four years.

15:04

That way, they're already familiar with how

15:06

the survey works when Erica dials them. And

15:08

so for that pay period that included May

15:10

12th, then how many total employees work to receive

15:13

pay?

15:15

Went up another person. Yay. We'll

15:18

take it. It doesn't happen very often lately.

15:21

Erica asked a few more questions. The

15:23

same she'll ask every employer. How many

15:25

of their staff are women? How many are

15:27

in non-supervisory roles? Total

15:30

payroll costs for everybody. And

15:32

the total hours were? I just want

15:33

me to put in a little note for the statisticians as

15:35

to the reason for that increase.

15:37

And Erica jots down notes for

15:39

why this company's employees were working

15:42

more hours this month. Thank

15:43

you. But you have a very happy Memorial Day.

15:46

And I'll check back in with you in June, okay? All

15:48

right. Thank you.

15:50

You too.

15:51

Have a good one. Okay. And if this is representative

15:54

of the rest of the economy, then we're doing pretty good in

15:56

the labor market.

15:57

Yep. I will take any little bit of increase

15:59

that I can...

15:59

see definitely.

16:00

I'm relieved

16:03

that it's another business that I can check off my list

16:05

and then I just put my nose to the grindstone

16:07

and call the other 399 cases

16:09

that I have. 399.

16:12

We call

16:12

it smiling and dialing and you just you

16:14

call you collect the data you thank

16:16

them you schedule them forward and you

16:19

hang up and then you just do the next call

16:21

and then all of a sudden you look up and it's lunchtime and you're like

16:23

where did the morning go? Has it gotten

16:25

easier or harder to get people to respond over the years?

16:28

It has gotten

16:30

harder. It has gotten

16:32

harder over over the years especially

16:36

after the pandemic there has been

16:38

some pushback from different respondents that don't

16:40

want to report the data because of

16:42

the political economy the way it is and

16:45

everything like that there has been some pushback.

16:47

There is some distrust there and I've actually had a few

16:50

people that have yelled at me and screamed at me

16:52

and then they called me back and apologized because they

16:54

realized that they took it down on the person. I'm

16:57

their outlet. I am the

16:59

person that they can physically talk to about the government.

17:02

Well I'm glad they at least apologize but it's

17:04

like maybe they should call their congressperson

17:06

instead of yelling at Erica. Yeah

17:08

absolutely call your congressperson. Erica

17:10

says she tries to get people to stay on the phone

17:13

by helping them understand why the

17:15

job numbers are so important. These

17:17

numbers feed into town planning or

17:19

business decisions about relocation and

17:22

also big decisions at the central

17:24

bank the Federal Reserve. So remember

17:26

that the Federal Reserve has two mandates.

17:29

At the moment it is really focused on getting price

17:31

inflation down but it also has the goal

17:34

to keep employment high to

17:36

keep jobs high and for those

17:38

jobs numbers the chair of the Federal

17:40

Reserve and his colleagues rely

17:43

on the numbers spoken to people like

17:45

Erica in a Florida call center.

17:47

At the moment the Federal Reserve might

17:49

keep raising interest rates which will make

17:51

people's mortgages or car loans more expensive

17:55

and with job numbers solid the Federal

17:57

Reserve is more likely to keep raising

17:59

interest rates. interest rates to fight inflation. But

18:02

that could change if the labor market deteriorates.

18:04

I mean it trickles down to your price of bread, milk

18:06

and eggs. So it does affect you,

18:09

you

18:09

just don't see it. And along with

18:11

explaining why the jobs report matters, Erica

18:13

also makes sure to build a strong

18:15

relationship with the people that she calls. I

18:18

have a couple respondents

18:19

that share a birthday and so I'll

18:21

make sure I put like a note in that they had a birthday

18:23

or it was their son's birthday party and ask them how

18:25

everything went kind of thing. Oh, so nice. And

18:28

I hope some people actually plan vacations to

18:30

Florida because they've asked, they've

18:33

been wanting to visit the area and I'll help them find

18:35

restaurants that locals like to eat at. So

18:37

let me get this straight, Erica's like an event planner, she remembers

18:40

birthdays and special occasions, she's like a

18:42

travel agent. I know, there

18:44

are many jobs wrapped into this one

18:47

interviewing job, it's incredible.

18:50

Erica also gets tips about specific industries

18:52

from people like a hairdresser mother.

18:55

I'm like mom, I'm like Fjalons. When

18:57

should I not call Fjalons? And I try and take

18:59

that into account and I take some advice from her that

19:02

Tuesdays are her busiest day. So then I might

19:04

not call them on a Tuesday to follow up with them.

19:07

Erica's soft skills are critical for getting

19:09

hard numbers correct. Several months

19:11

ago, we had jobs reports that didn't

19:13

seem so stellar, but they were later

19:16

edited to be actually quite good. The

19:18

numbers were revised up. And one

19:20

reason for those revisions was the Bureau

19:22

of Labor Statistics finally tracking

19:25

down those respondents and getting their missing

19:27

numbers after the deadline for Jobs Friday.

19:29

But to get ahead of the clock, Erica does

19:32

one other call. This one to a corporate

19:34

office in California.

19:35

How many total employees

19:36

work to receive pay?

19:38

That would be five employees.

19:39

And I feel like

19:41

it's about time for me to leave Erica

19:43

to continue with her work. I still have

19:45

another eight more calls left and I'm here for like another 45

19:48

minutes.

19:49

Erica ended up collecting 298 responses before the deadline.

19:54

A little less than she'd hoped, but not for lack

19:56

of trying. She said there was one day where

19:58

she squeezed in a massive 115 calls.

20:01

Well,

20:02

we are always looking out

20:04

for those jobs numbers, so we

20:07

thank you for doing the hard

20:09

work, getting those 300 or 400

20:12

calls every single month

20:14

and getting those numbers out there. Well, thank

20:16

you. These

20:19

episodes were originally reported for the Indicator

20:22

from Planet Money podcast, Planet Money's

20:24

daily podcast. Follow along if you're not

20:26

already. And if you've got any

20:30

slices of the economy, any metrics that

20:32

you want to learn much more about,

20:34

send us an email. We're at planetmoneyatnpr.org.

20:37

This episode was produced by Julia Ritchie and Jess

20:40

Kung with help from James Sneed. Engineering

20:42

was done by Gillie Moon, James Willits and Robert Rodriguez.

20:44

It was fact-checked by Michael Hart and Corey Bridges

20:46

and edited by Kate Concanon and Viet Le. Alex

20:49

Goldmark is our executive producer. Special

20:51

thanks to Nicholas Johnson at the Bureau of Labor Statistics

20:54

who really helped to make this whole episode possible.

20:56

I'm Darian Woods. This is NPR.

20:59

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