The latest statistics on poverty and income were released in the 2023 Current Population Survey’s (CPS) Annual Social and Economic Supplement (ASEC) on September 10, 2024. The ASEC supplement to the nation’s primary household labor force survey—the CPS—provides essential information on trends in poverty, income, and health insurance coverage. It measures the financial stability of families across the country as well as the effectiveness of government programs aimed at improving these measures. The survey data, collected in partnership between the U.S. Bureau of Labor Statistics (BLS) and U.S. Census Bureau, help policymakers determine the effectiveness of programs by tracking changes in poverty levels among different demographic groups over time.
However, funding constraints at the BLS could soon necessitate a reduction in sample size, which would decrease the accuracy of estimates made using these data and other statistics that rely on the CPS. These constraints could also hinder efforts to modernize the survey to address declining response rates that have affected government surveys for years.
The reports delivered by CPS data are influential enough to cause fluctuations in the stock market. To ensure accurate reflection of key economic experiences and serve as a reliable resource for guiding relevant policy decisions—particularly those surrounding labor markets and inflation—Congress must provide adequate funding for BLS. Specifically, it should meet the $812 million request for fiscal year (FY) 2025 made in a joint letter by two former BLS commissioners appointed by presidents from different parties.* This funding level is necessary to avoid cuts to sample size and allow BLS to advance modernization plans for CPS while improving data collection or gathering new cohorts for other surveys.
Funding constraints are not new to BLS or the Census Bureau, which jointly sponsor CPS. According to Center for American Progress analysis, funding for BLS has dropped by more than 13 percent compared with FY 2001 in inflation-adjusted dollars—the year when sample size increased to approximately 70,000 households. Compared with 2010—a high point in BLS funding—appropriations have been cut by over 20 percent after adjusting for inflation.
BLS Commissioner Erika McEnterfer noted that budgetary pressures might require a 5,000-household cut to the current CPS monthly sample. While this would not jeopardize overall numbers like national unemployment rates, it would make unemployment rates among subpopulations less reliable. Increased costs of data collection have further complicated matters, forcing reductions in-person visits and nonresponse follow-ups.
Currently, FY 2025 appropriations proposals from both chambers of Congress do not meet BLS's needs and propose cuts from FY 2024 levels after adjusting for inflation. Even BLS's funding request is insufficient due to spending growth limitations imposed by a debt ceiling deal.
Senators Patty Murray (D-WA) and Susan Collins (R-ME) organized a bipartisan budget agreement that could reverse this trend if an additional $182 million were allocated—0.9 percent of total funds from that agreement combined with allowed budget increases—to meet various needs outlined by former BLS Commissioners Erica Groshen and William Beach.
A potential reduction in sample size amid falling response rates poses risks to CPS data quality. Response rates have declined from around 90 percent to about 70 percent over the past decade due to factors like survey fatigue or distrust of unknown callers. Consequently, only around 42,000 monthly responses are received from its roughly 60,000 eligible households.
The proposed sample cut would likely increase the unemployment rate’s confidence interval slightly but still maintain reliability for headline statistics such as national unemployment rates while making understanding subpopulation trends less reliable.
Additionally, if enacted, Section 621 of House Appropriations Committee’s Commerce bill would prevent multiple follow-up contacts with households participating in surveys beyond twice—significantly reducing responses across all Census Bureau surveys including CPS.
Efforts continue towards modernizing CPS with internet self-response modes intended to improve response rates among groups less likely participate otherwise; these include households with young children or those speaking languages other than English at home.
CPS serves an important role measuring Americans' financial health through month-to-month labor force activity data accompanied by supplemental surveys delving deeper into personal finances—essential metrics guiding policymaker decisions including Federal Reserve adjustments promoting maximum employment/stable prices.
In conclusion: For policymakers meeting American people's needs ensuring equitable economy operations; researchers/policymakers/advocates require clear reality perspectives identifying effective policies/improvements needed via reliable data—highlighting importance modernizing-CPS/Congress appropriating sufficient funds enabling-BLS fulfilling crucial work without limiting household follow-ups collecting more responses.
*Authors’ note: The $812 million request includes an anticipated $68 million that BLS could transfer from Unemployment Trust Fund remaining same level allowed FY-2024.
