Payden & Rygel: US Employment Revisions
The annual preliminary benchmark revisions of the Current Employment Statistics (CES) Survey showed that the U.S. economy gained 818k fewer nonfarm jobs than previously reported over the 12 months ending March 2024. Bond investors, as always, rushed to the conclusion that the U.S. labor market is clearly rolling over.
We think the story is less clear-cut. First, while the revision indicates that the job growth prior to March 2024 was weaker than the previously reported pace of 242k per month, 174k monthly payroll gains still indicate a healthy labor market. Second, annual revisions to the CES survey have gone in both directions, and preliminary revisions offer differ from the final revision, as occurred in the last three years. Lastly, 818k [for the year] represents less than 0.5% of total nonfarm payroll employment - a relatively minimal change to the big picture of consumer income power.
The bottom line is that the revisions still show an economy adding jobs at a decent rate and tells us very little, if anything at all, about the labor market since March.
