US Job Growth Revised Down by 818,000: BLS

The US economy added 818,000 fewer jobs from March 2023 to March 2024 than previously recorded, according to the Bureau of Labor Statistics, which is more than the usual yearly adjustment. It is the largest downward revision since 2009, indicating that the labor market began losing speed earlier than previously assumed.

The revision of the previous year’s job gains showed that employment growth in 2023 would be 0.5% lower than what the Labor Department had reported. The annual changes typically boost or decrease employment levels by 0.1% from the preceding year.

Before the report, the BLS’s initial payrolls figures indicated employers added 2.9 million total jobs in the period, or an average of 242,000 per month. Assuming the change is distributed proportionately, the current monthly pace is expected to be approximately 174,000 – still a healthy rate of hiring, but a decrease from the high observed during the pandemic.

Benchmark revisions are made every year, but they were carefully examined by markets and Federal Reserve watchers this time for any signs that the labor market is cooling quicker than previously indicated.

Goldman Sachs economists predicted a drop in employment of up to 1 million. Goldman and Wells Fargo ultimately estimated the early benchmark revisions to be at least 600,000 jobs lower than previous forecasts, while JPMorgan Chase predicted a fall of around 360,000.

The data will help form Fed Chair Jerome Powell’s most recent evaluation of the labor market before his speech at the Jackson Hole Symposium on Friday. Given the decline in inflation from its high during the pandemic, policymakers are currently focusing on the labor markets as part of their dual mandate.