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Labor Department limits news outlets' use of embargoed data

FILE - In this Nov. 15, 2019, file photo a microphone stands at the entrance to a secure area during a closed-door interview with David Holmes, a career diplomat and the political counselor at the U.S. Embassy in Kyiv, Ukraine, on Capitol Hill in Washington. The Labor Department will begin restricting news organizations' use of economic data by barring computers from the rooms where reporters receive such data before its public release, department officials announced Thursday, Jan. 16, 2020. (AP Photo/Jose Luis Magana, File)
FILE - In this Nov. 15, 2019, file photo a microphone stands at the entrance to a secure area during a closed-door interview with David Holmes, a career diplomat and the political counselor at the U.S. Embassy in Kyiv, Ukraine, on Capitol Hill in Washington. The Labor Department will begin restricting news organizations' use of economic data by barring computers from the rooms where reporters receive such data before its public release, department officials announced Thursday, Jan. 16, 2020. (AP Photo/Jose Luis Magana, File)

WASHINGTON (AP) — The Labor Department will begin restricting news organizations' use of economic data by barring computers from the rooms where reporters receive such data before its public release, department officials announced Thursday.

The early access to embargoed data allows news services to prepare articles in advance of the public release of economic reports.

While credentialed reporters will still have early access to embargoed economic figures, the department says it's barring their use of computers during that time. The Labor Department said this is to ensure the security of the data and to prevent anyone from benefiting from early access to the data, which can influence stock and bond markets.

Department officials said the ban will go into effect March 1. It will cover all releases that the department issues each month, including the highly watched U.S. jobs report.

For several years, reporters have had to surrender their cellphones and other electronic devices before entering the so-called lockup rooms in order to prevent early transmission of the information in the reports. Yet they were allowed to write their news stories on computers that could transmit the data once the embargo lifted.

But in a letter to news organizations, Labor said the current process still gives some news organizations a competitive edge by allowing them to transmit the data through high-speed networks to serve such clients as investment firms.

“These updated procedures will strengthen the security of our data and offer the general public equitable and timely access,” William W. Beach, the commissioner of the department's Bureau of Labor Statistics, said in the letter.

The same Labor Department room is used to distribute to reporters embargoed data from the Commerce Department, including closely watched reports on the nation's gross domestic product, the broadest gauge of economic health. Commerce officials said those reports will continue to be issued at the Labor Department under the new restrictions.

The new system raises the risk, though, of overloading the departments' websites once the economic data is publicly released. Many high-frequency financial firms have been relying on news agencies to provide them with the data via computer lines. If those firms suddenly all besiege the departments' websites for that data, it could create a logjam that might make the data inaccessible to the public.

The move to bar the use of computers at the Labor Department will also complicate the ability of reporters to quickly write and distribute news articles about economic data. The Society for Advancing Business Editing and Writing issued a statement Thursday saying it was “deeply concerned” by the department’s decision.

“This limits journalists' ability to produce immediate, complete available-to-all reporting on government releases of economic data,” SABEW said. “Such a move would impede quality journalism and serve to give an information advantage to high-frequency traders with sophisticated algorithms capable of getting the data from government websites ahead of other investors and members of the public."

In 2012, worries about the premature release of sensitive economic data triggered a federal criminal and civil investigation, with the Securities and Exchange Commission, the FBI and the Labor Department's inspector general all investigating reports of possible leaks in the previous four years.

A study by the Sandia National Laboratories commissioned by the Labor Department concluded that if there had been leaks of economic data, the most probable source was not the Labor Department's press lockup room but individuals hacking into the Labor Department's computers.

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AP Business Writer Marcy Gordon contributed to this report.

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