The Bureau of Labor Statistics dramatically underestimated the number of jobs created by the U.S. economy over the summer, making a “surprising surge” look like a “substantial slump,” according to The Washington Post.
Changes to the BLS’s monthly jobs report are commonplace, but the magnitude of the undercounting is historic. BLS revisions added 629,000 jobs to the tally from June through September, the largest number for a four month period dating back to 1979.
“If those revisions were themselves a jobs report, they’d be an absolute blockbuster,” the Post reports.
The outlet adds:
The revisions have recast the narrative of a summer slowdown. In August, when economists expected a strong follow-up to the 943,000 jobs the economy added in July, the BLS announced the U.S. added only 235,000 jobs. Headlines dubbed it a “colossal miss” as job growth took a “giant step back.” Two months later, revisions based on additional data showed August jobs grew by 483,000, more than double the anemic original reading. It was the biggest positive revision in almost four decades.
Daniel Zhao, a senior economist at Glassdoor, added that the revisions “indicate that the Delta slowdown might not have been as severe as we originally thought,” according to Business Insider.
The BLS blamed their miss on business owners who failed to return surveys on time.
“We’re just improving the estimate using everything we know up through the month we’re releasing, really,” Angie Clinton, a BLS section chief, told The Post. “I mean, it sounds counterintuitive to most people because revisions — they think, ‘Oh, they got it wrong the first time.’ But no, we got it right, based on what the sample told us. But going forward we receive more sample, some corrected records, and recalculate seasonal factors, which together may indicate a different story.”
The BLS’s misleadingly bleak portrait of the economy might have created obstacles for President Joe Biden’s economic agenda.
“Naysayers and detractors from Biden’s agenda are going to exploit any ‘bad’ economic indicator they can as evidence for why Biden has it wrong on the economy or why Biden’s Build Back Better proposal gets it wrong on the economy, and in that sense underestimates of the jobs numbers are not helpful,” Lindsay Owens, executive director of the left-leaning Groundwork Collaborative, told the Post.