Stunning revisions show US added 258K fewer jobs than first reported
by Sylvan Lane
The U.S. added 258,000 fewer jobs in May and June than the Labor Department first reported, according to federal data released Friday.
The Bureau of Labor Statistics (BLS) issued stunning revisions to its reports on May and June employment growth in an overall dismal July jobs report, drastically changing the picture of the U.S. economy.
The U.S. only added 19,000 jobs in May compared to an initial report of 144,000, and only 14,000 in June after an initial report of 147,000, according to the BLS. Those two paltry totals, plus a July jobs gain of 73,000, means the U.S. added just 106,000 jobs over the past three months.
“Hiring has hit a wall in the U.S. Substantial downward revisions in payrolls means that private sector hiring has averaged a little more than 50,000 jobs over the past three months,” Bankrate senior economic analyst Mark Hamrick wrote in an analysis.
While the BLS often revises job figures, the scale of the revisions — and what they said about the economy — stunned experts and investors after a week of relatively solid economic data.
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The July jobs report showed the labor market stalling out last month, with most industries other than health care reporting meager job gains or outright losses. The report comes two days after the Federal Reserve kept interest rates steady, but with two members of the Fed board calling for lower rates.
President Trump raged against the Fed and its chair, Jerome Powell, in the hours before the report was released. Trump urged the Fed board to overrule Powell on future decisions and warned of future dissents from board members.
The combination of slowing job gains and rising inflation, however, make it harder for the Fed to respond without exacerbating either issue. Cutting interest rates can fuel economic activity to support job growth, but also risks fueling inflation. Keeping interest rates at moderately high levels can help snuff out inflation, but could hold back the job market.
“Persistent policy uncertainty, tariffs, and diminished immigration flows paralyzing employers, the US economy is now flirting with job losses, revealing a labor market that is much weaker than most Fed policymakers had believed,” EY-Parthenon chief economist Gregory Daco wrote in an analysis.
This dynamic, he said, now puts the Fed “behind the curve.”
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