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from https://finance.yahoo.com/news/labor-market-revisions-hit-those-watching-labor-revisions-hardest-morning-brief-100051007.html

Labor market revisions hit those watching labor revisions hardest:
Morning Brief

Myles Udland
Myles Udland·Head of News
Thu, Aug 22, 2024, 3:00 AM PDT3 min read

What we're reading

Economic data releases and earnings

Labor market revisions rarely garner Wall Street's attention.

Wednesday was an exception.

The annual benchmark revisions from the Bureau of Labor Statistics out Wednesday were closely watched by investors, with the report showing
there were 818,000 fewer people employed as of this March than had been previously reported.

As the team at Capital Economics pointed out in response on Wednesday,
this implies the average monthly job gains seen from March 2023 through
March 2024 were closer to 174,000 rather than the 242,000 initially
reported.

Economists don't expect this report to change the Federal Reserve's view
that a 0.25% interest rate cut is warranted next month, with more to
come later this year. Bank of America's economics team said this data
would "minimally" impact the Fed in a note on Wednesday.

We've known the labor market is slowing for some time. As the months
pass, we're learning more precisely how much things are cooling off.


Average job gains have slowed, and the unemployment rate has risen to
4.3%. But there is still a sense from many corners of the investment
world that this data understates softness in the labor market.

And Wednesday's report offered a clue as to why the kind of worker who
is paid or has the time to comment on revisions to BLS data might, specifically, believe this to be the case.

The BLS report on Wednesday broke down these labor market revisions by industry. And the biggest loser in terms of magnitude was professional
and business services. This industry saw estimated employment as of
March fall by 358,000, more than double the next-closest industry,
leisure & hospitality.

Add in downward revisions to information (read: tech) employment of
68,000 and financial activities of 76,000 and we're looking at more than
half a million jobs that can be broadly characterized as white collar
revised out of the labor market.

And this data is consistent with the general sense of malaise that has
hung over industries like tech and finance since the bear market of
2022. According to layoffs.fyi, there were more than 165,000 layoffs in
tech in 2022, over 260,000 layoffs in tech in 2023, and another 130,000
this year.

In total, Wednesday's revisions took 0.5% off the estimated size of the workforce as of March. But for these three industries — business
services, information, and financial activities — the drops were 1.6%,
2.3%, and 0.8%, respectively.

Story Continues

Meaning the three industries that most broadly capture jobs that can be described as "tech," "finance," "sending emails," and "taking Zoom
calls" were hit harder than the overall workforce by these revisions.

A helpful lens, perhaps, through which to understand why things like a
sharp three-day sell-off in the stock market are enough to kickstart the recession conversation: For the folks paid to watch these things
carefully, it already feels like one.


View Comments
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UTC LTV
5h ago
Front page news: Hiring is better than anticipated, GDP is sky high,
consumer spending is up. Week later on last page news: Hiring is much
slower, job creation is in government & healthcare only sectors, GDP
figures are revised down to near zero, and spending is up because prices
are 30% higher than 3 years ago.

Eddie
6h ago
For most of us who kept repeating something isn't right about these
government numbers while being described as MAGA's upset the economy was
doing so well. As it turns out we were right!
Now the question is, what other data has been incorrectly presented. Is
the U/E rate really 4.3%?

John W
2h ago
One thing I’m positive of - there have been more government jobs at
every level added in the last 3 years. Bigger and bigger government/
more and more employees added to make sure it gets bigger. This is how socialism starts - bigger and bigger government is the start.

JF
6h ago
Over 1.2 million American citizens lost their livelihoods last year
while 1.3 million migrants found work. Important to note: manufacturing declined by 115,000 positions. This is the primary sector that

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