The United States has created 500,000 fewer jobs since 2018 than previously announced, according to new figures

Bloomberg News / Landov

Hiring was not as strong in 2018 and early 2019 as the government initially reported – about half a million jobs.

The US economy had about 501,000 fewer jobs in March 2019 than the Bureau of Labor Statistics originally calculated in its survey of business establishments. This is the most significant revision since the slowdowns of the Great Recession in 2009.

The recently revised figures indicate that last year, President Trump's tax cuts and increased federal spending did not have a stimulating effect on the economy. They also point out that the economy is a bit weaker than previously thought and could give the Federal Reserve an even greater reason to cut interest rates in September.

"That makes sense, because the average monthly increase of 223,000 in 2018 seemed too good to be true in light of the tightness of the job market and the difficulty that companies would have in finding staff." qualified, "said chief economist Stephen Stanley. of Amherst Pierpont Securities.

The average increase of 223,000 jobs per month in 2018 – the highest in three years – could be reduced to 180,000 to 185,000, according to economists.

Fewer jobs have been created in restaurants, hotels, retailers and professional business services. Employment in recreation and hospitality was reduced by 175,000, business services by 163,000 and retail trade by 146,400.

This annual "reference" review is much larger than it usually is. The 2018 preliminary review, for example, showed that the economy created 43,000 additional jobs compared to the original forecast.

Each year, the Bureau of Labor Statistics updates its numbers based on unemployment data that almost all employers are required to pass on to the states. These revisions are generally small and represent about one-tenth of 1% of total non-farm employment.

The current revision reflects an adjustment of 0.3%, although the number is not definitive. The 2018 revision was finally changed again from 43,000 to -1,000.

The final results will be published in February 2020.

What remains to be seen is if the lowest employment numbers end up showing that wage growth has been much stronger over the last year than is being said by the government figures.

Hourly wage growth has barely exceeded 3% per annum, which is a surprisingly modest increase given the unemployment rate close to 3.7%, its lowest level in 50 years. Tight labor markets typically result in annual wage increases of up to 4%.