Explaining the Large Downward Revisions in U.S. Job Data
President Trump ousted the head of the Bureau of Labor Statistics after May and June payroll gains were revised down by 258,000 jobs, prompting scrutiny of data collection and historical revision patterns.
President Donald Trump dismissed the head of the U.S. Bureau of Labor Statistics after May and June job growth estimates were reduced by 258,000 roles—an unusually large combined adjustment. Trump accused the figures of being "rigged" to undermine his administration.
Data Collection and Revision Process
The BLS compiles the monthly jobs report from two surveys: the 60,000-household Current Population Survey and the 121,000-employer Current Employment Statistics survey. The establishment survey, covering roughly one-third of nonfarm payroll jobs, is generally seen as more reliable due to its larger sample and automated reporting from major firms.
Initial payroll estimates represent a preliminary, lower-resolution snapshot. Subsequent monthly revisions incorporate more complete data, while an annual benchmark adjustment uses unemployment insurance tax records for greater accuracy.
Historical Context of Revisions
Adjustments to May (down 125,000 jobs) and June (down 133,000) mark the largest two-month downward revision outside the pandemic period since 1979, when record-keeping began. However, significant revisions are not unprecedented—similar large-scale changes occurred around the 2008 financial crisis and in early 2020.
Average monthly revisions typically range around 57,000 jobs (up or down), but can spike during economic turbulence. For example, January 2009 was revised down by 143,000 jobs under President Obama.
Challenges in Data Collection
Response rates for the employer survey have declined from over 60% a decade ago to below 43% in recent months, raising concerns about data reliability. Similar trends in Canada, Sweden, and the UK have prompted efforts to explore new web-based survey methods.
Despite these challenges, a Federal Reserve Bank of San Francisco review found that recent revision patterns remain consistent with pre-pandemic norms, offering reassurance to data users.
Major downward revisions reflect the evolving precision of job data, not political interference, underscoring the complexity of capturing a dynamic labor market.
This topic was reported by BBC News.
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