New data shows that employment growth in the US was far weaker than originally reported

CNN
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U.S. job growth was much weaker than originally expected for most of last year, according to new data released Wednesday.

The Bureau of Labor Statistics' preliminary annual benchmark review of employment data shows that there were 818,000 fewer jobs in March of this year than originally reported.

Each year, the BLS revises data from its monthly survey of business payrolls and then compares the March employment figures with those from the quarterly Employment and Wage Census program.

The preliminary data represent the biggest downward revision since 2009 and show that the labor market was not quite as hot as initially thought. However, employment growth was still strong.

Compared to the previous year, the average monthly employment increase from April 2023 to March 2024 was 150,000 compared to 218,500.

“It is important for markets to remember that these are not job losses, but that the number of jobs has simply never been this high,” wrote Chris Rupkey, chief economist at FwdBonds, in a note on Wednesday. “The economy apparently did not need this phantom workforce, as robust real consumer spending drove very strong [economic] Growth in the second half of last year.”

The downward revisions were limited to the private sector. Almost half of these were in the professional and business services sector (downwardly revised by 358,000 or 1.6 percent). Other sectors with large negative fluctuations were the information industry (minus 68,000 or 2.3 percent), leisure and hospitality (minus 150,000 or 0.9 percent) and manufacturing (minus 115,000 or -0.9 percent).

The estimates published by the Labor Department on Wednesday – with an atypical delay of more than half an hour – are preliminary and will not be finalized until February 2025.

While Wednesday's revision will not change the existing monthly employment data for now, it serves as another important indicator of the overall health and activity of the U.S. labor market. Employment growth has fallen more than expected in recent months, making the situation even more delicate for the Federal Reserve and its considerations of interest rate cuts.

This story is evolving and will be updated.