The recent jobs report released on Thursday highlights a concerning trend: the U.S. labor market appears to be losing momentum. According to the Bureau of Labor Statistics (BLS), significant revisions were made to previous employment figures for July and August, indicating an overstatement of approximately 33,000 jobs. Specifically, job creation for July was revised down from a gain of 79,000 to 72,000, while August’s numbers saw a drastic adjustment from a previously reported gain of 22,000 to a loss of 4,000.
The September report, which revealed the addition of 119,000 jobs, was delayed due to the ongoing government shutdown that temporarily furloughed BLS employees, originally set to be released on October 3. Implications of the shutdown stretch further, as federal employment has decreased by 97,000 jobs since its peak in January. It is also important to note that employees on paid leave or receiving severance packages are still counted as employed in the BLS establishment survey.
Public sentiment reflects the challenging economic landscape, with a recent Fox News national survey indicating that 76% of voters rate the economy negatively, a rise from 67% in July and 70% by the end of former President Joe Biden’s administration. Many voters are pointing fingers at President Donald Trump, with a substantial number blaming him more than Biden for the current economic state.
Moreover, Trump’s approval ratings relating to his economic management have plummeted to lows, and his overall job approval has faced record disapproval ratings, even among his former supporters. Despite this, Trump continues to advocate for his economic policies, including tax cuts and deregulation, arguing they are working. However, the narrative has been challenged, especially following his abrupt dismissal of BLS commissioner Erika McEntarfer just hours after the agency exposed substantial job growth overstatement from earlier months.
This contentious relationship with economic performance metrics persists as the BLS also announced that the upcoming October jobs report would not be released as a stand-alone document due to data compilation issues during the shutdown. Consequently, the public and markets will have to wait until December for a more accurate assessment of the job market’s trajectory.
The developments in the labor market present a complex scenario, underscoring the need for robust economic policies and transparent communication regarding employment data. As the nation faces these economic challenges, there remains hope that forthcoming reports and strategic measures will lead to renewed growth and stability in the labor market.