The revisions to previous estimates of the size of U.S. payrolls gains for May and June that prompted President Donald Trump to fire Bureau of Labor Statistics Commissioner Erika McEntarfer on Friday were by any measure extraordinarily large.
Indeed, the combined downward revision for the two months of 258,000 was the largest – outside of those during the early months of the COVID-19 pandemic – since at least 1979.
Here’s a quick graphical breakdown:
Shows revisions to prior estimates for U.S. employment
FIRST REVISION
The monthly nonfarm payrolls report, released typically on the first Friday of each month, includes an initial estimate of employment changes for the immediately preceding month and revisions to the earlier estimates for the prior two months.
BLS makes the revisions because more survey responses come in over the ensuing weeks and because it updates the seasonal factors affecting each month’s estimates.
The BLS on Friday said 133,000 fewer jobs had been created in June than first estimated. Over the last several years, the first estimate of the net change in payrolls each month has been revised lower more often than not.
It has been revised down in eight of the last 12 BLS reports over the last year.
The downward revision on Friday was the largest since the first estimate of payrolls gains for March 2021, published in April 2021, was revised down by 146,000 a month later.
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Over the last three years through June, the median estimate revision was -10,000. That contrasts with a median increase of 8,000 during the decade before the pandemic and a median increase of 2,000 over the series history since 1979.
Shows payrolls revisions
SECOND REVISION
The total for May’s payroll gains was revised lower by 125,000 in Friday’s report, when the third estimate for payrolls for that month was published.
That figure was the largest downward reduction of payrolls gains for a second revision – outside of the pandemic era – since the estimate for March 1983 was revised down by 127,000 in the report published in June 1983.
Shows revisions to prior estimates for U.S. employment
COMBINED REVISION
The combined downward revision for the two previous months – May and June – was larger than anything reported outside of the pandemic era.
Indeed, the estimates for the two prior months combined have more often than not been revised higher.
Since 1979, the median two-month combined estimate change was an upward revision of 10,000.
Measured in absolute terms – revisions in either direction – Friday’s revision also stands out.
There have only been four larger revisions: +709,000 for November and December 2021; -642,000 for March and April 2020; +285,000 for August and September 1983; and +414,000 for April and May 1981.
