The week of the Democratic national convention in Chicago was marred for Joe Biden and Kamala Harris when the federal bureau assigned with measuring employment figures released a disturbing correction. It was revealed that the prior year’s job growth had been overestimated by a whopping 818,000 jobs.
This data correction comes as a blow to the Biden Harris government which had prided itself on the recent job gains under their administration. However, these ‘significant’ achievements now appear less impressive in the face of persistent, high inflation.
In a keenly observed event on August 22 in Cochise County, Arizona, former President Donald Trump took this as an opportunity to lambast Harris and Biden over their handling of the economy. Trump pointed out the overblown job figures that had come out of the current administration over the past year.
“They claimed falsely that they created 818,000 jobs,” he commented. The recently adjusted employment data paints a vastly different picture, with 818,000 fewer jobs than initially claimed by the Biden-Harris administration.
Despite the considerable decrease in jobs, amounting to half a percentage point of all jobs in the nation, some economists still declined to support Trump’s accusation of number-manipulation by the Biden-Harris team. They viewed the process as an annual adjustment undertaken to refine initial estimates.
In an attempt to dismiss Trump’s claims, Douglas Holtz-Eakin, the president of the center-right American Action Forum, emphasized that this revision is a standard procedure. Interestingly, the adjustment seems to come at a convenient time; it attempts to discard any suggestion of the Biden-Harris administration’s mishandling of the economy.
The federal Bureau of Labor Statistics announced an annual ‘benchmarking’ adjustment on August 21, based on a broad survey of state-level unemployment insurance data. This is deemed more precise than the employer-based data utilized to construct their often-debated monthly employment reports.
Utilizing this supposedly comprehensive unemployment data, the agency concluded that there were 818,000 fewer jobs in March 2024 than previously declared. This significant downward correction, the largest in the last 15 years, sparked concerns among economists about a potential weakening economy.
This could provide fodder for those arguing that the Federal Reserve should reduce interest rates at its upcoming September meeting. However, one can’t help but wonder if manipulations of such important data points could lead to rushed and possibly unfit decisions.
In response to discussions, Anna Kelly, a spokesperson for the Republican National Committee, accused the Biden-Harris administration of shirking responsibility for the economic crisis they had contributed to. However, the RNC failed to deliver tangible evidence to verify Trump’s charge about the illicit tampering of job statistics.
No matter how the Biden-Harris administration attempts to spin it, this recalculation doesn’t seem like a mere administrative adjustment. The Bureau of Labor Statistics, manned by experienced civil servants, has had a clean reputation thus far, free from allegations of political bias.
However, the same procedures used to recalculate have been in effect for years. Yet, under the Biden-Harris administration, they led to the largest downward employment revision in over a decade. Is mere chance responsible for this, or does it indicate a deeper issue with the current administration’s economic policies?
According to Tara Sinclair, a George Washington University economist and former deputy assistant secretary for macroeconomics in the Treasury Department’s Office of Economic Policy, comparable revisions during Trump’s presidency also indicated a marked decrease. One can’t help but question if the Biden-Harris administration has been more focused on controlling the narrative rather than tackling the root of these problems.
Sinclair suggests that economists desire complete data, yet that requires time and follows a scheduled release plan. However, the recent announcement of such a massive downward revision, which is yet to be finalized by February 2025, may cast doubts on the credibility of this ‘preliminary’ data, and the efficiency of the Biden-Harris administration’s economic strategies.