Why 818,000 Fewer Jobs Signal a Healing Economy. Don’t Panic.
https://www.bloomberg.com/opinion/articles/2024-08-21/job-revisions-show-economic-healing-don-t-panic
A year ago, commentators were concerned that payrolls were growing too fast, keeping inflation elevated. It turns out the labor market was just right.
Related: https://www.nytimes.com/2024/08/21/business/economy/us-jobs-economy.html
https://www.bloomberg.com/opinion/articles/2024-08-21/job-revisions-show-economic-healing-don-t-panic
A year ago, commentators were concerned that payrolls were growing too fast, keeping inflation elevated. It turns out the labor market was just right.
Related: https://www.nytimes.com/2024/08/21/business/economy/us-jobs-economy.html
Labor market revisions hit these workers the
hardest
The BLS report on Wednesday broke down these labor
market revisions by industry. And the biggest loser in terms of magnitude was
professional and business services. This industry saw estimated employment as
of March fall by 358,000, more than double the next-closest industry, leisure
& hospitality.
Add in downward revisions to information (read: tech)
employment of 68,000 and financial activities of 76,000 and we're looking at
more than half a million jobs that can be broadly characterized as white collar
revised out of the labor market.
What I stated back in September 2023:
‘Overly data-dependent’ — how the Fed and the markets keep getting it wrong
https://thehill.com/opinion/finance/4189467-overly-data-dependent-how-the-fed-and-the-markets-keep-getting-it-wrong/
Yet economic data are often unreliable. Official statistics undergo multiple and often substantial revisions. For instance, consider the widely watched non-farm payroll numbers. Initial estimates of monthly job gains/losses are widely reported by the media, and financial markets and the Fed often react sharply to this major data point.
Less widely-appreciated is that the payroll numbers undergo subsequent revisions —sometimes large ones that give the lie to the initial perceptions. Annual benchmark revision of 2022 data, for instance, indicated more robust employment figures than previously reported. In contrast, this year’s early rounds of revisions have consistently been downward.
‘Overly data-dependent’ — how the Fed and the markets keep getting it wrong
https://thehill.com/opinion/finance/4189467-overly-data-dependent-how-the-fed-and-the-markets-keep-getting-it-wrong/
Yet economic data are often unreliable. Official statistics undergo multiple and often substantial revisions. For instance, consider the widely watched non-farm payroll numbers. Initial estimates of monthly job gains/losses are widely reported by the media, and financial markets and the Fed often react sharply to this major data point.
Less widely-appreciated is that the payroll numbers undergo subsequent revisions —sometimes large ones that give the lie to the initial perceptions. Annual benchmark revision of 2022 data, for instance, indicated more robust employment figures than previously reported. In contrast, this year’s early rounds of revisions have consistently been downward.