Job Market Was Weaker Than Reported in 2023 and 2024

Washington, DC, August 22, 2024-"The job market from early 2023 through early this year wasn’t as hot as it seemed at the time, new government data suggested Wednesday,” according to the Wall Street Journal.

“Compared with the still-official numbers, employers might have added 818,000 fewer jobs in the 12 months through March, the Labor Department said. That means the economy could have added around 178,000 jobs a month over that period, as opposed to the current estimate of 246,000 jobs a month.

“Wednesday’s report marked the first step of an annual process by which the Labor Department updates older payroll figures using data from state unemployment-tax records that is more comprehensive, but less timely, than its monthly employer survey. It is only a preliminary estimate of a revision that will be made to the official numbers in February.

“Investors had already been anticipating a downward adjustment for the period in question. Many haven’t quite believed that the labor market was as strong as payroll figures have suggested because other data points-such as a rising unemployment rate-have told a less rosy story. (The unemployment rate is based on a separate survey, of households instead of employers.)

“A surprisingly big increase in the unemployment rate last month has increased speculation that the Federal Reserve might cut interest rates by a larger-than-normal half a percentage point at its next meeting on Sept. 17-18-although other, more reassuring data have tempered those bets.”