U.S. job market weaker than expected in 2024 and early 2025, according to new data.

The U.S. job market exhibited a significant decline in strength during 2024 and the first months of 2025, according to newly released data from the Labor Department. The revised figures reveal that employers added 911,000 fewer jobs over the year ending in March 2025 than previously reported, raising serious concerns regarding the overall health of the nation’s economy.

The Labor Department issues annual benchmark revisions intended to more accurately reflect labor market conditions by accounting for new businesses and those that have closed down. The latest adjustments, made public on Tuesday, are preliminary, with final numbers expected in February 2026. Among various sectors, the leisure and hospitality industry saw a reduction of 176,000 jobs, while professional and business services reported 158,000 fewer jobs and retailers 126,000 fewer.

This troubling news follows a disappointing jobs report released last Friday, which indicated that only 22,000 jobs were created in August. This trend adds to widespread apprehension about the impact of President Donald Trump’s economic policies, which some analysts suggest have contributed to uncertainty and reluctance among businesses to hire new employees.

Sal Guatieri, a senior economist at BMO Capital Markets, remarked that the revisions illustrate a considerably weaker job market than initially perceived. Although these revisions do not reflect trends following March, they suggest that the labor market lacked momentum leading into ongoing trade tensions. Current data suggests that job creation has further slowed, with a monthly average of only 53,000 new positions added since March.

The recent benchmark adjustments may intensify pressure on the Federal Reserve to consider interest rate cuts during its upcoming meeting as a means to provide economic stimulation. The Labor Department’s earlier disappointing report for July prompted President Trump to dismiss the economist responsible for compiling employment statistics and replace her with a more loyal candidate. His frustration was largely fueled by the loss of 258,000 jobs reported for the months of May and June.

Despite challenges in obtaining accurate labor statistics due to a decline in employer participation in surveys, the majority of economists and financial experts continue to view the official jobs data as credible. The current employment landscape indicates considerable uncertainties ahead, as the economy grapples with multiple challenges that may have far-reaching implications for job seekers and policymakers alike.

The revamped portrayal of the job market further intensifies the dialogue surrounding the U.S. economy and underscores the importance of closely monitoring these critical trends moving forward.

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