How Wonky US Payroll Revisions Became Controversial

The US created 818,000 fewer jobs in the year through March than initially estimated — the largest downward revision in 15 years, the Bureau of Labor Statistics said on Aug. 21. While those adjustments usually fly under the radar, the recent figures have caused a commotion — both on Wall Street and in Washington DC. Former President Donald Trump, the Republican nominee, has claimed that the early estimates were fabricated and the Biden administration “defrauded the people of our country.” But while the adjustment was a big one, the revisions are part of a decades-long, albeit confusing, exercise aimed at achieving a more accurate picture of the labor market.

It’s rare that a preliminary benchmark revision to payrolls gets attention outside the economics community but interest in the report gained immense traction on Wall Street and in politics. First, there were forecasts for a steep decline. The actual figure reaffirmed bets US central bankers will begin lowering interest rates soon.