U.S. job growth significantly weaker than initially reported

• Revised by 818,000 jobs, it is the largest downgraded labor market reporting since 2009.

The U.S. labor market wasn’t as strong as portrayed during the year from April 2023 through March 2024.

On Wednesday, the U.S. Bureau of Labor Statistics revised its estimate of total employment for that period downward by 818,000 from what was initially reported.

It is the largest such downgrade since 2009.

The resulting significantly weaker labor report means the U.S. economy is estimated to have added on average 173,500 jobs monthly instead of what was reported as upwards of 242,000 jobs monthly.

According to the BLS data, the professional and business services industry was revised down by 1.6% while the information industry was downgraded by 2.3%.

As noted, the revised numbers are taken from the Quarterly Census of Employment and Wages that uses data from state unemployment insurance records and actual payrolls.

The downward revision in the labor market comes at a time when U.S. job growth has slowed in recent months. July’s report showed only 114,000 jobs gained.

In addition, the Federal Reserve continues to ponder the right time to lower key interest rates. Whether this latest revised labor market report factors into those discussions could play out when they meet September 17.

The Fed’s benchmark interest rate has been set in the 5.25%-5.50% range for more than a year. Analysts are eyeing a potential quarter of a percent cut next month.