The U.S. labor market may be weaker than previously reported, as the Bureau of Labor Statistics (BLS) prepares to release its annual benchmark revision today. Economists warn that hiring numbers for the past year could be revised sharply downward, showing that job growth has been hundreds of thousands lower than earlier estimates.
Major Jobs Revision Could Cut 800,000 Positions
At 10 a.m. ET, the BLS will issue its preliminary revision covering the 12 months through March 2025. Experts expect the data to show that the U.S. economy added about 800,000 fewer jobs than first reported.
Economists say the update could lower the average monthly job growth in 2024 from 165,000 to around 100,000. This would confirm that the labor market slowdown began earlier than thought, as businesses faced tariff costs and turned to artificial intelligence to cut expenses and replace workers.
“The labor market will likely look even worse after the benchmark revision,” said Bill Adams, chief economist at Comerica Bank.
Trump Administration and Jobs Data Dispute
The revision is expected to attract attention from the Trump administration, after the president fired the BLS commissioner last month over concerns about job data accuracy.
The new report mainly covers the last year of President Biden’s term, though it also includes the first three months of Trump’s second administration.
Meanwhile, job growth has already slowed in recent months, with employers adding only 29,000 jobs per month between June and August, according to the latest BLS data.
Why the BLS Revises Jobs Data
The Bureau of Labor Statistics issues monthly reports, but adjusts figures later as more businesses submit responses. Each year, the agency conducts a major revision based on the Quarterly Census of Employment and Wages (QCEW), which covers over 95% of U.S. jobs.
While the monthly survey includes about 50,000 businesses, the QCEW collects data from 11 million workplaces, offering a more accurate picture of employment gains and losses at both new and closed businesses.
Previous Jobs Revision in 2024
Last year, the BLS also issued a significant downward revision, cutting 818,000 jobs from its March 2024 data. That change lowered the average monthly job growth for the period from 242,000 to 174,000, signaling early cracks in the labor market and prompting the Federal Reserve to cut rates in September 2024.
Impact on Federal Reserve Rate Cuts
With job growth stalling and the Consumer Price Index (CPI) for August expected to show 2.9% inflation, economists believe the Federal Reserve will cut interest rates at its September 17 meeting.
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Some analysts predict a 0.25% cut, the usual step.
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Others say a larger 0.5% “jumbo cut” is possible if the slowdown proves severe.
“Market odds currently see a 100% chance of a Fed rate cut this month,” said Anthony Saglimbene, chief market strategist at Ameriprise.
However, a higher-than-expected CPI report on September 11 could push the Fed toward a smaller cut.
Trump’s Nominee for BLS Commissioner
In August, President Trump nominated E.J. Antoni from the Heritage Foundation to lead the BLS. Antoni has criticized the agency’s methods, once writing on X that the bureau “needs a chainsaw.”
In response, the National Association for Business Economics (NABE) defended the BLS, calling for a qualified and independent commissioner to maintain the credibility of U.S. statistics.
“The BLS must remain independent and protect its mission of delivering reliable, unbiased economic data,” NABE said.
