According to the Bureau of Labor Statistics (BLS), the U.S. economy created 818,000 fewer jobs from March 2023 to March 2024 than initially reported, but this is a larger than normal annual adjustment.
The Bureau of Labor Statistics’ (BLS) annual revision of the previous year’s job growth rate resulted in a 0.5% decrease in job growth for 2023 from the figure originally released by the Labor Department. Such annual revisions typically result in a 0.1% increase or decrease in the previous year’s employment level, the bureau said.
Experts were preparing for a major annual revision.
Economists at Goldman Sachs predicted a job loss of as much as 1 million. The investment bank and Wells Fargo ultimately projected a tentative rebasing of at least 600,000 fewer jobs than they had previously forecast, while forecasters at JPMorgan Chase & Co. saw a decline of about 360,000.
Wednesday’s rate change would be the biggest since 2009 and could raise concerns that the Fed’s interest rate cut, which it took from near zero in March 2022 to a range of 5.25% to 5.5% in July 2023, may be delayed.
Interest rates have been at their highest level in 23 years for more than a year as the central bank aims to keep inflation closer to its 2% target.
Inflation fell below 3% in July for the first time since the pandemic, and the Fed is expected to cut interest rates when it meets in September.
The big downward revision comes as Vice President Harris seeks to craft a victory message on the economy after President Biden struggles to overcome criticism of his handling of the economy and inflation, which peaked at 9% in June 2022 amid the pandemic.
The Federal Reserve is a politically independent institution and does not receive instructions on interest rates from the president or other elected officials.
But Americans are feeling the pressure of rising prices and the rising borrowing costs of lowering them, and inflation has been a frequent target of attack by former President Trump and Republicans ahead of the November election.
Polls show Harris leading Trump by three points, but Trump holds the edge on the economy, according to a polling analysis by The Hill and Decision Desk HQ.
aNew ABC News/Washington Post/Ipsos PollThe poll found that Trump has a nine-point lead in confidence in his handling of the economy and inflation, a top priority for most Americans.
“This preliminary estimate does not change the fact that the jobs recovery has been historically strong, delivering solid job and wage growth, strong consumer spending, and record small business creation,” Jared Bernstein, chairman of the White House Council of Economic Advisers, said in a statement.
Updated 3:07 p.m.. EDT
