John Lynch, CIO of Comerica Wealth Management, discusses his outlook for the 2024 employment revision, his expectations for Fed Chairman Powell’s Jackson Hole speech, where to allocate capital, and target returns.
Government statistics tend to paint a rosier picture of the economy than Americans actually believe it to be. For example, more than half of Americans believe the country is in a recession. And while there’s no official recession, it’s clear that millions of Americans don’t believe in that rosy scenario.
Jobs is one of the few areas President Joe Biden and Vice President Kamala Harris can boast about since taking office. Under their administration, inflation has soared, with prices rising 20% and real income falling by $2,100 per household, but hiring has been strong and the unemployment rate has remained fairly low.
“Kudlow” panelists Steve Moore and Scott Besent compare the economic policies of former President Trump and Vice President Kamala Harris.
But it turns out that last year’s employment numbers were about 30% lower than initially announced.
As Fox Business reported, “The U.S. economy created 818,000 fewer jobs in the 12 months ending in March 2024 than initially reported, the Labor Department reported Wednesday. As part of a preliminary annual benchmark revision of nonfarm payrolls, the Bureau of Labor Statistics said the actual job gains from April 2023 through March of the following year were nearly 30% lower than the 2.9 million originally reported.”
U.S. economy creates 818,000 fewer jobs than last reported
The 818,000 downward revision is not just a rounding error. 3% is a rounding error. 30% means you’ve been fed a distorted view of the economy.
Former Home Depot CEO and Chairman Bob Nardelli spoke about the U.S. employment data and argued that the job market is “tight.”
I’m not accusing the Bureau of Labor Statistics of wrongdoing — they’re the experts — but their models are flawed. They’ve revised down their original headline employment forecasts for at least 9 of the last 10 months.
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Equally troubling is that the Labor Department overestimated already low private sector employment numbers and slightly overestimated government employment, which only further underscores a point I’ve been making on these pages for months.
Jobs are being created in the wrong places.
Stephen Moore is co-founder of Unleash Prosperity and an economic adviser to the Trump campaign.
