The Labor Department’s latest “annual benchmark revisions” show that the labor market isn’t as strong as previously believed.
Every month, the Bureau of Labor Statistics estimates how many jobs the economy added or subtracted based on a representative sample of 689,000 employer work sites.
But there are around nine million employer establishments nationwide. So BLS checks its estimates against tax records covering nearly all those employers.
In its preliminary report this year, 500,000 fewer jobs turned up, said BLS economist John Stewart.
“By comparison, since 1979, a downward revision of 501,000 would be the third-largest that we’ve seen,” Stewart said.
Betsey Stevenson, a University of Michigan economist, said it’s a sign the labor market is weaker than we thought.
“It’s possible that when you see a particularly large negative number, it signals that the economy is at a turning point,” she said.
There were also big downward revisions in 1981, 1991 and 2009, all of which coincided with recessions.
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