The U.S. labor market added 911,000 fewer jobs from April 2024 to March 2025 than previously estimated, the Bureau of Labor Statistics announced Tuesday. The preliminary revision — the largest such adjustment on record — indicates that the labor market was considerably weaker last year than economists thought.
In the initial reports, U.S. employers added 1.8 million jobs during the 12-month period, but the revised data shows that the total was about 847,000, or a bit less than half the previous total. Average monthly job growth has been reduced from roughly 147,000 a month to about 70,000.
The downward revision means there were 176,000 fewer jobs created in the leisure and hospitality sector in the year ending March 2025; 158,000 fewer jobs created in professional and business services; and 126,000 fewer jobs created in retail.
The revised numbers come on the heels of the August jobs report, which confirmed that the labor market has been slowing sharply over the last few months, a dynamic many economists have linked to the Trump administration’s tariff hikes.
Slower for longer: The revised numbers may help explain why so many Americans have been reporting for more than a year that the economy is weaker than some of the top-level data would suggest.
Heather Long, chief economist at Navy Federal Credit Union, said the updated data pushes the beginning of the slowdown further into the past. “The frozen job market started way before this summer,” Long wrote on social media.
We won’t know the monthly distribution of the downward revisions until more complete data is released in February, making it hard to pinpoint the beginning of the softer hiring trend.
RSM Chief Economist Joseph Brusuelas said that the revision bolsters the decision by the Federal Reserve to cut interest rates by a full point in 2024. He also noted that in the context of the national economy, the latest revisions are not as large as they may seem at first glance and are consistent with an economic growth rate of about 1.4%, as expected.
“In an economy where 163.3 million individuals are employed, a downward revision of 911,000 distributed over the space of twelve months is not that large from a quantitative point of view,” Brusuelas wrote in a research note.
Still, the revision does suggest that the economy has been just puttering along for many months now. Economist Sal Guatieri of BMO Capital Markets told the Associated Press that the revision paints “a much weaker portrait of the job market than initially thought. While the revision doesn’t say much about what has happened since March, it suggests the labor market had less momentum heading into the trade war.”
Claiming victory: The White House found vindication in the revised numbers. “Today, the BLS released the largest downward revision on record proving that President Trump was right: Biden’s economy was a disaster and the BLS is broken,” White House Press Secretary Karoline Leavitt said in a statement.
Leavitt claimed that the report proves that the president was justified when he fired the head of the BLS last month — though the leader, Erika McEntarfer, was fired by Trump because the jobs numbers for July were too low and thus “rigged” against him, in his view.
Experts admit that there are long-standing problems with BLS data collection but say it has more to do with insufficient funding and falling response rates to surveys than any kind of intentional manipulation by political operators. The data also typically has trouble detecting turning points in the economy.
James Knightley, an economist at ING, wrote in a research note that the BLS data can be “significantly wrong” when the economy downshifts. “In the early stages of a downturn they tend to overestimate the jobs created by new start-ups – ‘births’ – and underestimate the number of jobs lost by the ‘death’ of failing small businesses,” he wrote. “These revisions suggest that jobs momentum is being lost from an even weaker position than originally thought. It also reinforces the belief that even the poor numbers seen in 2025 are probably overstating the health of the employment market.”
More fuel for the Fed: The White House said the revision also confirms that Trump was correct when he demanded that the Federal Reserve cut interest rates.
“Jerome ‘Too Late’ Powell … has officially run out of excuses and must cut the rates now,” Leavitt said, referring to the Fed’s leader.
Whether Trump can take credit or not, it seems all but certain that the Fed will cut its benchmark rate for the first time this year at the conclusion of its meeting on September 16 and 17, and the revisions only bolstered that expectation. The odds of more than one rate cut this year are rising, as well, with the CME FedWatch Tool showing a 70% chance of a rate cut in October and a 63% chance of a rate cut in December.