Trump, the BLS and Jobs

The jobs report for July was issued on Friday and the top line number proved to be disappointing.

The Bureau of Labor Statistics reported that only 73,000 net jobs were added in July.

Economists were forecasting job gains of over 100,000.

Even worse, the BLS revised job numbers for May and June by shaving 258,000 jobs off of its last two reports.

May was revised down from 144,000 jobs to 19,000.

June was revised lower from 147,000 to 14,000.

This is not the first time we have seen major downward revisions to the jobs numbers.

Revisions are a normal outcome of the BLS survey process in which they use a sampling of employers to derive the employment numbers. Not all employers respond when they should and more data comes in the following month or two.

The chart below shows a graph of BLS revisions going back to 1955. 

Revisions can go both ways but in the last few years there appears to have been a decided error rate where downward revisions have become more common.

Credit: https://medium.com/@baogorek/bls-jobs-revisions-have-been-out-of-control-since-the-1950s-ee189eb4da6f

For example, in 2024 leading up to the election, we saw a string of months that touted good job growth numbers that were later revised downwards.

In fact, during the Biden years, 45 of 48 months were revised downwards after the initial report.

Some argue that the survey response rate has gotten worse since Covid which has made the initial BLS numbers suspect.

However, the initial job number is what gets all of the attention. 

It is the number that the media plays up, that Wall Street is paying attention to and that the Federal Reserve is basing its interest rate decisions on.

The revisions get little notice most of the time.

If we can't rely on the original number each month it is like the blind leading the blind.

For example, if the Fed had seen the revised BLS jobs number in May and June we most likely would have seen a rate cut in June and/or July.

Instead, Fed Chairman Jerome Powell only two days before the BLS revisions stated that the "labor market is solid" in his explanation as to why the Fed was holding interest rates steady. 

Seeing all of this President Trump reverted to the form he was famous for when he hosted The Apprentice on television.

He fired Dr. Erika McEntarfer the head of the Bureau of Labor Statistics who was appointed by Biden in 2023.

Source: https://www.cnn.com/2025/08/01/business/trump-job-report-number-fire

The media is attempting to paint the firing as Trump taking retribution for the bad jobs numbers in this month's report that in his words were"rigged".

However, when you take a step back and look at the accuracy of the reports during the tenure of Dr. McEntarger, it appears something is wrong somewhere.

How can you be off so much in your data that you have to revise the jobs numbers down by 87% in May and 90% in June?

Something is amiss if 45 of 48 monthly job reports had to be revised downwards.

It may not be the direct fault of the BLS chief, and the numbers may not be "rigged", but how can we accept data failures this large when so many decisions are being made that rely on the accuracy of these numbers?

Doesn't there have to be some accountability somewhere?

All of that being said, there were positives in the jobs report if you were Trump.

First, the disappointing jobs numbers in the report undermine the Fed claim that the "labor market is solid".

The odds that the rate cuts that Trump has been lobbying for have improved significantly after the BLS jobs report.

Before the jobs report was released, the betting odds were only 34% that there would be an interest rate cut of 25 basis points in September.

Those odds are now over 70%. The odds for a 50 basis point cut have risen from 2% to 8%.

Source: https://polymarket.com/event/fed-decision-in-september?tid=1754231760519

Trump should also take comfort that jobs for native born workers are seeing a resurgence.

Over the last several years all net job growths has come from foreign born workers.

I referenced data a year ago that showed that all net job growth since 2020 in the United States had come from foreign born workers. 

All of the net growth of 3 million jobs had been among foreign born workers. None from native born workers.

This is reversing under the Trump administration this year.

You can see the effect more clearly in this chart that just shows job growth over the last 12 months between native born and foreign born workers.

Finally, all of the net new jobs added to the U.S. economy this year have been from the private sector. Public sector jobs are actually down by 3% in 2025 so far.

In 2023, 28% of job growth was in government jobs. In 2024, it was 24% of the total.

Source: BLS
Credit: https://x.com/EricLDaugh/status/1951797363292680500

Trump's economic and immigration policies appear to be positively impacting those he promised he would focus his efforts on the most during his campaign for office.

This is a big, big change in a short period of time.

Considering everything Trump has on his plate right now there is no reason he should be concerned about whether the labor numbers are not reliable or might be "rigged".

You would think with all the technology and interconnectivity with data today that we would not still be using 1950's survey techniques as the basis for our most important economic indicators.

However, that is where we are.

You can argue that Trump overreacted in firing the BLS Director.

She undoubtedly inherited a bad process.

However, with the run of significant jobs numbers that required large revisions you would think that someone would pay a little more attention to improving the process since so much is riding on these numbers.

How do we fix things that are broken unless a signal is sent that business as usual is no longer acceptable in Washington, D.C.?