Nearly 1 million fewer jobs than initially reported, the largest downward revision in 15 years.
Kamalanomics is crushing our economy.
And despite Democrats’ efforts, the American people know it’s true because they experience it every day.https://t.co/ogYElKi9tg
— Speaker Mike Johnson (@SpeakerJohnson) August 22, 2024
The Bureau of Labor Statistics (BLS) released its annual benchmark revisions to the nonfarm payroll numbers on Wednesday, revealing that the U.S. economy created 818,000 fewer jobs than initially reported in the 12-month period through March 2024. This revision, amounting to a 0.5% reduction in total payrolls, marks the largest downward adjustment since 2009. The revisions hit certain sectors harder than others.
Professional and business services saw the most significant downward revision, with job growth adjusted down by 358,000. Leisure and hospitality (-150,000), manufacturing (-115,000), and trade, transportation, and utilities (-104,000) also experienced substantial reductions. Within the trade category, retail trade numbers were cut by 129,000.
The Biden Administration overestimated up to a million jobs over the past year. The largest downward revision in 15 years. The economy is significantly weaker than the Administration has led us to believe. https://t.co/ERW3lGssDo
— Rep. Don Bacon 🇺🇸✈️🏍️⭐️🎖️ (@RepDonBacon) August 20, 2024
BLS's preliminary benchmark revision shows that 818,000 fewer jobs were created from Mar 2023 to Mar 2024 than originally reported.
I take no signal about the economy from this for several reasons.
A short 🧵. (Also see nice writeup by @bencasselman https://t.co/wIugoDJn9x) pic.twitter.com/7kHDKbILZp
— Jason Furman (@jasonfurman) August 21, 2024
However, some sectors saw upward revisions, including private education and health services (87,000), transportation and warehousing (56,400), and other services (21,000). Government jobs remained largely unchanged, adding just 1,000 after the revisions.
Labor market sees significant revision
The Bureau of Labor Statistics announced that 818,000 of the jobs the Harris-Biden Administration “created” don’t exist.
This is the largest downward revision in 15 years.#Kamalanomics is FAILING the American people.https://t.co/xeEkXJ3xlB
— Congressman Jim Baird (@RepJimBaird) August 21, 2024
Despite the downward revisions, nonfarm payroll jobs totaled 158.7 million through July, a 1.6% increase from the same month in 2023. Concerns about a weakening labor market have been raised, as the unemployment rate rose to 4.3%, up by 0.8 percentage points from its 12-month low. This increase triggers the “Sahm Rule,” a historically accurate measure indicating a potential recession.
However, the rise in the unemployment rate is primarily attributed to more people returning to the workforce rather than a significant surge in layoffs. Jeffrey Roach, chief economist at LPL Financial, commented, “The labor market appears weaker than originally reported. A deteriorating labor market will allow the Fed to highlight both sides of the dual mandate, and investors should expect the Fed to prepare markets for a cut at the September meeting.”
White House economist Jared Bernstein emphasized that the overall jobs recovery remains strong, delivering solid job and wage gains, strong consumer spending, and record small business creation, despite the preliminary estimate.
Economists at Goldman Sachs suggested that the BLS might have overstated the revisions by as much as half a million, attributing some of the discrepancy to undocumented immigrants who were initially listed as employed but are not currently in the unemployment system, along with a general tendency for initial revisions to be overstated. Federal Reserve officials are closely monitoring the jobs data and are expected to approve their first interest rate cut in four years during their next meeting in September. The Fed Chair is set to deliver a policy speech at the annual retreat in Jackson Hole, Wyoming, which might lay the groundwork for easier monetary policy ahead.
