BLS Revision is Worse than Expected

Understanding the latest BLS Jobs report. What they are stating is, the labor force is large at 140 million and companies tend to overstate employment. Probably for good reason. If they all stated what was really happening in their company and industry, we probably would have been in trouble far earlier. In which case, profits would have been far less. Speculating a bit here . . .

‘Behind the curve,’ POLITICO:“ ‘inherited a far worse economy than reported and he’s right to say the Fed is choking off growth with high rates.‘

While the preliminary revision announced Tuesday was higher than economic experts anticipated, many expected a sizable write-down. The Fed also factors in an array of metrics when setting policy — most notably inflation numbers — and board members know to bake in some leeway to account for possible changes in BLS numbers. (Fed Gov. Christopher Waller, a potential candidate to replace Powell, said in a recent speech that he expected the annual revision to eliminate around 60,000 jobs per month from the 12-month average.)

Jed Kolko, who was a Commerce undersecretary for economic affairs in the Biden administration.

“The preliminary benchmark revision was in the range that was widely expected, though toward the steeper end of that range. We’re starting from a very large base of 160 million jobs in the economy, so even small revisions in percentage terms will be high numbers.’

The BLS said the difference between the results of its routine survey and the more comprehensive Quarterly Census of Employment and Wages totaled 911,000 between March 2024 and March 2025. The QCEW is primarily pulled from state administrative records tied to the unemployment insurance tax system.

According to the BLS, businesses that responded to its surveys reported higher employment numbers than indicated by the QCEW, and those that did not reply also had lower employment over that span than those that did.“

The following is about a day old.

Wall Street expected a big jobs revision. The reality is even worse. Quartz

The Bureau of Labor Statistics just published its annual benchmark revision on Tuesday morning. While few analysts expected good news, the revision is substantially larger than expected, and lands at a moment of widespread political and economic turmoil.

Economists broadly expected the agency to report the U.S. added about 700,000 fewer jobs from March 2024 to March 2025 than earlier believed. Instead, the figure was revised down by 911,000.

The immediate reaction? Stock futures had pointed to a strong open on Tuesday morning, but the bigger-than-expected revision encouraged more moderate, sideways moves, at least on announcement.

More importantly, the markdown is big enough to reshape the larger picture of the labor market over the last year. It also intensifies the sense of stagflation now taking hold: slowing job growth alongside rising inflation. Consumer prices for August are due on Thursday and are expected to show another uptick, too.

Meanwhile, the White House has already been rattled by last Friday’s weak jobs report, which showed just 22,000 new positions in August, with nearly all of the growth coming from healthcare and support services. Outside those segments, job creation has essentially flatlined this year — while dark clouds loom over the healthcare field as Medicaid cuts are set to kick in October 1, resulting from the “Big Beautiful Bill” passed in July. In other words, if the growth from healthcare disappears, growth may disappear altogether.

President Donald Trump has railed against BLS data specifically in recent months as a broad slowdown in jobs growth appeared to take hold. In early August, he dismissed a similar routine revision of BLS figures as a “SCAM” and then fired the agency’s commissioner.

Even as experts argue the agency’s processes allow little chance for such meddling, Trump’s allies are likely to argue that the large revision is evidence that the bureaucracy has been cooking the numbers, or failing that, to shift blame for the slowdown onto former President Joe Biden and Federal Reserve chair Jerome Powell. Commerce Secretary Howard Lutnick has gone further, promising a coming “jobs boom” once Trump’s corporate investment agenda kicks in.

Weakening confidence in the job market

The BLS revision also comes at a time of weakening confidence among workers. A New York Fed survey released Monday showed that confidence in finding a new job after losing one fell to 44.9%, the lowest in the survey’s history dating back to 2013.

Expectations that the unemployment rate will be higher a year from now also ticked up. Among white-collar professions, layoffs appear to be accelerating, and many workers are “job-hugging,” reluctant to leave positions in a market that no longer feels favorable.

What Wall Street wants

Investors are hoping the large revision will inspire the Fed to begin cutting rates at its meeting later this month, perhaps even towards a half-point “jumbo” cut. Current expectations, however, point to a more modest cut of 25 bps.