The U.S. economy added 818,000 fewer jobs from March 2023 to March 2024 than initially reported, according to the Bureau of Labor Statistics (BLS), larger than the typical annual adjustment.
The annual BLS revision of the previous year’s job gains showed 2023 employment growth falling 0.5 percent from what the Labor Department first reported. Such annual revisions typically increase or decrease the previous year’s employment levels by 0.1 percent, the agency said.
Experts were bracing for a sizeable annual revision.
Economists at Goldman Sachs forecasted a decline of up to 1 million jobs. The investment bank and Wells Fargo ultimately expected the preliminary benchmark revisions to be at least 600,000 jobs weaker than previous estimates, while JPMorgan Chase forecasters expected a decline of about 360,000.
Wednesday’s revision — the largest since 2009 — could fuel concerns that the Federal Reserve may be behind on cutting interest rates, which it hiked from near zero in March 2022 to a range of 5.25 percent to 5.5 percent in July 2023.
Interest rates have remained at a 23-year high for more than a year as the central bank aims to bring inflation in line with its 2 percent target.
Inflation finally dipped below 3 percent in July for the first time since the pandemic, and the Fed is expected to cut rates at its meeting in September.
The large downward revision comes as Vice President Harris is working to craft a winning message on the economy after President Biden struggled to overcome attacks on his handling of the economy and inflation, which peaked at a pandemic-induced 9 percent in June 2022.
The Fed is a politically independent body and does not take direction on interest rates from the president or any other elected official.
But Americans have felt the weight of higher prices — and higher borrowing costs aimed at bringing down those prices — inflation has become a frequent line of attack from former President Trump and Republicans ahead of the November election.
While Harris is leading Trump by 3 points in the polls, according to polling analysis by The Hill and Decision Desk HQ, Trump retains an edge when it comes to the economy.
A new ABC News/Washington Post/Ipsos poll found Trump leading by 9 points in trust to handle the economy and inflation, which is top of mind for a large majority of Americans.