Labor Department Revises Job Growth Down by 911,000 Through March 2025

Labor Department Revises Job Growth Down by 911,000 Through March 2025

The U.S. labor market produced substantially fewer jobs than originally estimated, according to a Labor Department report released Tuesday. The Bureau of Labor Statistics (BLS) preliminary benchmark revisions show a downward adjustment of 911,000 nonfarm payroll jobs created in the 12 months ending March 2025.

This revision surpasses initial Wall Street projections, which ranged from 600,000 to 1 million fewer jobs, marking the largest benchmark revision recorded since 2002. On a monthly basis, the revision translates to an average of 76,000 fewer jobs added than previously reported, underscoring a weakening employment landscape.

Sectoral Impact and Economic Implications

The downward revisions were broad-based, with leisure and hospitality facing the largest cut of 176,000 jobs, followed by professional and business services (-158,000) and retail trade (-126,200). Most sectors saw reductions, except transportation, warehousing, and utilities, which experienced modest gains. Government employment was also revised down by 31,000 jobs.

These figures reflect updated data from the Quarterly Census of Employment and Wages and tax records, providing a more comprehensive reassessment than monthly incremental adjustments. The revisions predominantly cover the private sector and largely predate the Trump administration’s tariff policies, indicating labor market deterioration began earlier.

Market and Policy Reactions

Financial markets showed muted reactions, with stocks largely unchanged and Treasury yields recovering losses following the report. Economists suggest the slower job creation implies weaker income growth, which may prompt the Federal Reserve to reconsider its monetary policy stance. Oren Klachkin, economist at Nationwide Financial, commented that the revised data strengthens the case for the Fed to resume interest rate cuts amid slowing economic activity.

Political Context and Data Reliability Concerns

The revisions add to ongoing criticism of the BLS from the White House, which has questioned the accuracy of the agency’s data collection methods. After a disappointing July jobs report and downward revisions, President Donald Trump dismissed then-BLS Commissioner Erika McEntarfer and appointed E.J. Antoni as her replacement. However, subsequent monthly data continued to reflect a softening labor market.

White House Press Secretary Karoline Leavitt stated, “Today, the BLS released the largest downward revision on record proving that President Trump was right: Biden’s economy was a disaster and the BLS is broken. This is exactly why we need new leadership to restore trust and confidence in the BLS’s data on behalf of the financial markets, businesses, policymakers, and families that rely on this data to make major decisions.”

Looking Ahead

The benchmark revisions are preliminary and will be subject to further updates when the BLS releases the final figures in February 2026. The previous benchmark revision for the year ending March 2024 initially showed an 818,000-job downward adjustment, later revised to 598,000.

While the revisions represent approximately 0.6% of the 171 million-member labor force, their implications for economic policy and political debate are significant. The evidence of labor market softness adds momentum to calls for the Federal Reserve to lower interest rates, as emphasized by the White House urging Chair Jerome Powell to act promptly.