According to the Bureau of Labor Statistics, the US economy added 818,000 fewer jobs from March 2023 to March 2024 than previously reported. This is a significant downward revision and the largest since 2009, indicating that the labor market began slowing down earlier than expected.
The revised job gains for last year showed that employment growth in 2023 was actually lower by about half a percent compared to what was initially reported by the Labor Department. Typically, annual adjustments only have a minimal impact on employment levels – usually around an increase or decrease of just 0.1%.
Before this report came out, initial figures from BLS showed that employers had added a total of 2.9 million jobs during this period at an average rate of about 242,000 per month. However, with these revisions factored in proportionately across each month’s numbers,the current monthly pace would be closer to around174 ,000 – still considered healthy hiring but lower compared to peak levels seen during the pandemic.
While benchmark revisions are made every year,it was closely watched by markets and Federal Reserve watchers this time as it could indicate if there is any faster cooling off inthe labor market than previously thought.
Economists at Goldman Sachs predicted up to one million job losses while both Goldman Sachs and Wells Fargo estimated early benchmark revisions would result in at least600 ,000 fewer jobs comparedto previous forecasts.JPMorgan Chase also predicteda declineofaround360 ,00jobs .
This data will play into Fed Chair Jerome Powell’s assessmentofthe labor market aheadof his speechat Friday’s Jackson Hole Symposium.As inflation has dropped from its peak duringthepandemic,policymakers are now focusing on labor markets as part of their dual mandate.
