U.S. Payroll Growth Was 30% Less Than Reported — Largest Revision Since 2009 Job growth figures across multiple sectors saw significant downward revisions.
By Erin Davis
Key Takeaways
- Preliminary annual benchmark revisions show the U.S. economy added 818,000 fewer jobs than first reported, marking the largest revision since 2009.
- Revised job data indicates a softer labor market, possibly influencing the Federal Reserve's decision towards a September interest rate cut.
The Labor Department reported Wednesday that the U.S. economy produced 818,000 fewer jobs from April 2023 through March 2024 than initial tallies suggested.
The 0.5% total payroll level revision—the most substantial dip since 2009—was nearly 30% less than the initially reported 2.9 million.
The Bureau of Labor Statistics's revisions came after the agency analyzed data from the Quarterly Census of Employment and Wages, part of an annual process that occasionally reveals departures from monthly updates.
We are aware there was a delay to the CES preliminary benchmark announcement. We are looking into the reason for the delay. We have no additional information to share regarding the delay at this time. https://t.co/nXPlwtZZa7
— BLS-Labor Statistics (@BLS_gov) August 21, 2024
"The revisions aren't a shock, given the estimates were for one million fewer jobs," Robert Frick, corporate economist with the Navy Federal Credit Union, said in a note, per Bloomberg. "This doesn't challenge the idea we're still in an expansion, but it does signal we should expect monthly job growth to be more muted and put extra pressure on the Fed to cut rates."
Related: CPI Report: Inflation Hits 3-Year Low, Analysts Predict Fed Will Cut Rates Next Month
The revisions resonated throughout sectors, including professional and business services, which saw job growth reduced by 358,000. Leisure and hospitality, manufacturing, and trade, transportation and utilities also faced significant downward corrections.
Meanwhile, Federal Reserve Chair Jerome Powell's upcoming speech in Wyoming is being closely watched for any hints of eased monetary policies, especially with the expected rate cut in September.
"The labor market appears weaker than originally reported," Jeffrey Roach, chief economist at LPL Financial, told CNBC. "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."
Related: The Federal Reserve Is on Instagram
