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NEW DELHI: US job growth over the past year was notably weaker than previously reported, according to new data released by Bureau of Labor Statistics on Wednesday.
The Labor department announced that monthly payroll figures had overstated job growth by approximately 818,000 for the 12 months ending in March. This revision shows employers added about 174,000 jobs per month, down from the previously reported 242,000, marking a 28% decrease, according to a New York Times report.
The adjustment represents roughly 68,000 fewer jobs each month, the largest downward revision since 2009. These changes are largely based on state unemployment tax records that employers are required to file.
The preliminary data could be updated when the final numbers are released in February 2025, according to media reports. The largest revisions were seen in professional and business services, with other notable decreases in manufacturing, information sectors, leisure and hospitality.
Impact on Federal Reserve policies
Federal Reserve policymakers are closely watching the labor market following a disappointing July jobs report, which showed only 114,000 new jobs and an unexpected rise in the unemployment rate to 4.3%. This increase has triggered the Sahm rule, indicating a potential recession.
Anticipated Fed rate cuts
With these developments, the Fed is expected to consider rate cuts more aggressively.
Investors expect the Fed to consider rate cuts more aggressively at its next meeting on September 18. About 67% anticipate a 25-basis point reduction, while 32.5% are preparing for a larger half-point cut, according to media reports.
The Labor department announced that monthly payroll figures had overstated job growth by approximately 818,000 for the 12 months ending in March. This revision shows employers added about 174,000 jobs per month, down from the previously reported 242,000, marking a 28% decrease, according to a New York Times report.
The adjustment represents roughly 68,000 fewer jobs each month, the largest downward revision since 2009. These changes are largely based on state unemployment tax records that employers are required to file.
The preliminary data could be updated when the final numbers are released in February 2025, according to media reports. The largest revisions were seen in professional and business services, with other notable decreases in manufacturing, information sectors, leisure and hospitality.
Impact on Federal Reserve policies
Federal Reserve policymakers are closely watching the labor market following a disappointing July jobs report, which showed only 114,000 new jobs and an unexpected rise in the unemployment rate to 4.3%. This increase has triggered the Sahm rule, indicating a potential recession.
Anticipated Fed rate cuts
With these developments, the Fed is expected to consider rate cuts more aggressively.
Investors expect the Fed to consider rate cuts more aggressively at its next meeting on September 18. About 67% anticipate a 25-basis point reduction, while 32.5% are preparing for a larger half-point cut, according to media reports.
