Headline report continues to diverge from the Household Survey and QCEW
This article first appeared on SchiffGold.
The analysis below covers the Employment picture released on the first Friday of every month. While most of the attention goes to the Headline Report, it can be helpful to look at the details, revisions, and other reports to get a better gauge of what is really going on.
The jobs report showed a modest increase of 147k jobs. While that was a decent showing, the Household Survey only showed a gain 93k.
As can be seen below, the deviation in these two reports has been happening for a long time.
Figure 1: Primary Report vs Household Survey - Monthly
For the year, the Household Survey is significantly higher due to the data anomaly in January. However, if we removed the data correction in January, the Household Survey would actually show a loss of 530k.
Figure 2: Primary Report vs Household Survey - Annual
Switching to the headline report…
The BLS publishes the data behind their Birth/Death assumptions (formation of new business). In June, there were 24k jobs assumed into existence. This is on the heels of April and May that assumed 590k jobs into existence so it was good to see a more reasonable number in the report.
Figure 3: Primary Unadjusted Report With Birth Death Assumptions - Monthly
For the year, the birth death assumption is positive against a negative number for actuals (-62k).
Figure 4: Primary Unadjusted Report With Birth Death Assumptions - Monthly
There is another report published by the BLS called the Quarterly Census of Employment and Wages (QCEW). According to the BLS, this is a far more accurate and rigorous report covering 95% of jobs available at a highly detailed level. Due to the rigor, the report is released quarterly on a several month lag.
The latest report is for Q4 2024. As shown, October and December were big underperformers relative to the standard jobs report.
Figure 5: Primary Report vs QCEW - Yearly
The chart below sums up everything you need to know about the Headline Report. Compared to the more accurate QCEW, the QCEW was 43% below the Headline Report! For context the next biggest miss was in 2016 where the QCEW was 17.5% below. 2024 was more than double the next closest miss!
Figure 6: Primary Report vs QCEW - Yearly
The 147k jobs number was accompanied by a drop in the unemployment rate to 4.1%.
Figure 7: Change by sector
When looking over the last 12-month trend, only two categories were above trend.
Figure 8: Current vs TTM
The table below shows a detailed breakdown of the numbers. The table also shows that the Government numbers were negative at the federal level and positive at a state and local level.
Monthly Average Change | Total % Change | ||||||||
|---|---|---|---|---|---|---|---|---|---|
Category | Total Employed | Current Month | 3 Months | 12 Months | 3 years | Current Month | 3 Months | 12 Months | 3 years |
Private Sector | |||||||||
Construction | 8,324 | 15 | 7.0 | 10.1 | 15.7 | 0.2% | 0.3% | 1.5% | 6.8% |
Education Health | 27,342 | 51 | 73.0 | 73.2 | 85.4 | 0.2% | 0.8% | 3.2% | 11.2% |
Financial | 9,256 | 3 | 6.0 | 7.4 | 5.5 | 0.0% | 0.2% | 1.0% | 2.1% |
Information | 2,947 | 3 | 3.0 | -0.5 | -3.7 | 0.1% | 0.3% | -0.2% | -4.5% |
Leisure Hospitality | 17,043 | 20 | 22.3 | 21.7 | 35.1 | 0.1% | 0.4% | 1.5% | 7.4% |
Manufacturing | 12,750 | -7 | -4.7 | -7.4 | -0.5 | -0.1% | -0.1% | -0.7% | -0.1% |
Mining and Logging | 621 | -2 | -1.0 | -0.2 | 0.3 | -0.3% | -0.5% | -0.3% | 1.9% |
Other Services | 6,034 | -5 | 0.7 | 5.0 | 9.9 | -0.1% | 0.0% | 1.0% | 5.9% |
Prof Business | 22,603 | -7 | 6.7 | -3.0 | 1.2 | 0.0% | 0.1% | -0.2% | 0.2% |
Trade Trans Utils | 29,106 | 3 | 1.7 | 15.0 | 12.1 | 0.0% | 0.0% | 0.6% | 1.5% |
Government | |||||||||
Government Federal | 2,946 | -7 | -15.0 | -4.5 | 2.6 | -0.2% | -1.5% | -1.8% | 3.2% |
Government Local | 15,172 | 33 | 28.3 | 21.4 | 27.9 | 0.2% | 0.6% | 1.7% | 6.6% |
Government State | 5,580 | 47 | 21.7 | 12.6 | 13.2 | 0.8% | 1.2% | 2.7% | 8.5% |
Total | |||||||||
All | 159,724 | 147 | 149.7 | 150.8 | 204.8 | 0.1% | 0.3% | 1.1% | 4.6% |
Values in 1,000s of workers. Data as of: Jun 2025. Total Employed = Entire size of the labor market. | |||||||||
The chart below shows how the jobs data has been revised. So far, every month this year has been revised lower by a significant margin.
Figure 9: Revisions
Over the last twelve months, jobs have been revised down by about 20.1k per month and revised lower by 13.7k over the last three months!
3 Month Compare | 12 Month Compare | 3 Year Compare | |||||||
|---|---|---|---|---|---|---|---|---|---|
Category | Current | As Of Published | Avg Month Diff | Current | As Of Published | Avg Month Diff | Current | As Of Published | Avg Month Diff |
Private Sector | |||||||||
Construction | 11 | 30 | -6.3 | 121 | 176 | -4.6 | 572 | 619 | -1.3 |
Education Health | 233 | 208 | 8.3 | 904 | 820 | 7.0 | 3,113 | 2,912 | 5.6 |
Financial | 18 | 30 | -4.0 | 94 | 109 | -1.2 | 202 | 267 | -1.8 |
Information | 4 | 5 | -0.3 | -9 | 0 | -0.8 | -115 | 17 | -3.7 |
Leisure Hospitality | 92 | 92 | 0.0 | 232 | 355 | -10.2 | 1,349 | 1,584 | -6.5 |
Manufacturing | -6 | -16 | 3.3 | -92 | -69 | -1.9 | 18 | 146 | -3.6 |
Mining and Logging | -2 | -2 | 0.0 | -1 | -4 | 0.2 | 23 | 23 | 0.0 |
Other Services | 24 | 3 | 7.0 | 76 | 60 | 1.3 | 370 | 322 | 1.3 |
Prof Business | 16 | -8 | 8.0 | -46 | 13 | -4.9 | 114 | 702 | -16.3 |
Trade Trans Utils | -6 | 39 | -15.0 | 168 | 208 | -3.3 | 517 | 707 | -5.3 |
Government | |||||||||
Government Federal | -49 | -38 | -3.7 | -45 | -34 | -0.9 | 90 | 86 | 0.1 |
Government Local | 68 | 67 | 0.3 | 234 | 225 | 0.8 | 994 | 848 | 4.1 |
Government State | 19 | 53 | -11.3 | 113 | 131 | -1.5 | 438 | 334 | 2.9 |
Total | |||||||||
All | 422 | 463 | -13.7 | 1,749 | 1,990 | -20.1 | 7,685 | 8,567 | -24.5 |
Values in 1,000s of workers. Because this data is focused on revisions, it is as of the month prior: May 2025. "Current" shows the change in employment after revisions. "As Of Published" shows change in employment at time of release. "Avg Month Diff" shows the average monthly change from the revisions. | |||||||||
Another level of detail in the Household report shows full-time vs part-time job holders. This month shows that full-time jobs were gained while part-time were lost.
Figure 10: Full Time vs Part Time
The chart below shows data going back to 1955.
Figure 11: Historical Labor Market
The labor force participation rate is still well below the highs before the Global Financial Crisis. This month it increased slightly to 62.3%.
Figure 12: Labor Market Distribution
No doubt, the two major takeaways from this report are:
When looking at a slightly weak jobs report, these two additional facts point to a much bleaker job picture than what is being presented on the surface.