All it took was a year or two of extremely obvious "catches" of leaked data for the government to begin to decide that perhaps, just perhaps, it is time to end the press lockup for each week's initial jobless claims data. As the WSJ reports, the original idea behind lockups was to give reporters time to digest complicated economic reports to produce accurate reports for the public. In the past decade, news organizations have also built expensive networks to send government data to high-speed investors who can make trades on the data before members of the public can react. Now, however, the BLS believes, "government data is for the public good and it is paid for by taxpayer dollars. There must be a commitment to a level playing field."
A Labor Department panel has called for abandoning media lockups for a key weekly measure of U.S. employment.
The recommendation is the first formal call by a government entity to end media lockups and could hasten a move away from the government's decades-old practice of releasing sensitive economic data through the media.
A lockup is the term used for the traditional way in which government agencies release market-moving data to the public. In a lockup, reporters are given embargoed copies of the reports and are "locked" in media rooms, without the ability to send their stories to the public until the embargo is lifted.
Following the release of the Inspector General's report examining problems with the release, however...
the Labor Department said in a statement: "We agree with the [Inspector General] that it is appropriate to consider ending the [unemployment insurance] weekly claims press lockup."
It continued: "In fact, well before the release of the [Inspector General's] report, the department began exploring the value of the press lockup...and intends to continue its consideration of how best to disseminate the report to the public and to news organizations."
Of course, even if the end-users hadn;t been so obvious, you would have changed the plan? Hmm...
The new report could provide new momentum to that effort, though political pressure and technological barriers remain. Any move to end lockups will face lobbying pressure from news organizations that benefit from the current system because they control the dissemination of the government's economic data.
Nonetheless, the recommendation from the Labor Department's Office of inspector General represents the most significant step to date toward scrapping the current system of media lockups.
Keith Hall, a former commissioner of the Bureau of Labor Statistics, said "government data is for the public good and it is paid for by taxpayer dollars. There must be a commitment to a level playing field."
The Inspector General made six recommendations to improve the release of the weekly report to eliminate the "competitive advantages provided to news organizations inside the lockup," according to the report.
"Absent a viable solution," the report suggested that the department "consider discontinuing the use of the press lockup."