Business Operations

The U.S. economy added 911,000 fewer nonfarm jobs and 95,000 fewer manufacturing jobs than previously reported in the 12 months ending in March 2025, the Bureau of Labor Statistics announced today (BLS).

• This report is the preliminary benchmark revision of the BLS establishment survey, which the agency performs every year; the final revision will be issued in February.

What it means: The revision indicates that the BLS survey greatly overstated job gains last year. In the period between April 2024 and March 2025, 1.76 million new jobs were reported, but only 847,000 jobs were created, averaging 70,580 job gains per month.

• For context, last year’s preliminary benchmark report revised the jobs numbers down by 818,000 for all nonfarm employment and 115,000 for manufacturing.

The bigger picture: “Although a revision of this size is not unprecedented when measuring as a percent of the first estimate, it is incredibly large,” said NAM Chief Economist Victoria Bloom. Here are some important facts for more context:

• The BLS’s Birth-Death model “is due for improvements,” Bloom said.

• It has been misestimating business closures and openings since the pandemic, for example, and more recently has begun overestimating payroll growth. Meanwhile, the BLS has had an increasingly hard time with administering the surveys, grappling with such problems as a drop in response rates.

• Furthermore, misestimations tend to be more dramatic during shifts in the business cycle, since it is harder for the BLS to accurately estimate business growth during recessions and the subsequent recoveries. Nonetheless, revisions, on average, are smaller than they were decades ago.

• “We should anticipate recent employment estimates to also be revised down in the future,” Bloom predicted.

 The conclusion: “Although it was already apparent that there was weakness in the labor market in the third quarter of last year, leading the Federal Reserve to cut their interest rate target by 100 basis points in the second half of 2024, this revision shows that weakness was more significant,” Bloom said.

• “The [Federal Open Market Committee] was already expected to cut their interest rate target by 25 basis points next week, and I anticipate that will remain true.”