Update: A Year With No Jobs—But No Recession

Today’s employment report confirmed that payroll growth stalled last year. The benchmark revision in March 2025 subtracted 898,000 jobs from the level, and total downward revisions by the end of 2025 exceeded one million. The revised series (orange) aligns closely with my forecast (blue dashed). The good news in the report was that January showed a stronger-than-expected rebound in hiring, and the unemployment rate edged down to 4.3%.

Here is my interview on Bloomberg right after the data came out.

[The revisions are] not a sign that the Bureau of Labor Statistics is asleep at the wheel. We just have some major dynamics in the economy, and it’s really tough to measure in real time. We’ve got better data today, and that’s a great starting point for understanding where we are going!

Here is my original Substack post, which held up well today:

A Year With No Jobs—But No Recession