This morning the Bureau of Labor Statistics (BLS) revealed a big downward revision to the job growth picture.
The annual revision of 818,000 jobs was the largest negative one-off adjustment since 2009 (the depths of the financial crisis). If we distribute that equally across, already twice revised, job growth data for the twelve months through March of this year, we get the chart below …
From this chart, we can see the initially reported nonfarm payroll series of data in blue (and the 12-month average). And after all revisions (including this morning's adjustment), we get the red line (and the adjusted 12-month average).
In short, the initial payroll numbers were overstated by an average of 100,000 jobs a month.
Remember, the Fed has been mandated by Congress, to pursue both price stability AND maximum employment.
By holding interest rates too high for too long, the rate-of-change in the unemployment number and this weaker job growth picture suggests they've traded one problem (inflation) for another problem (unemployment).
Let's hope they haven't traded inflationary boom for deflationary bust.
In the case of the latter, as I've said here in my daily notes, we would be getting all of the debt from the trillions of dollars of government spending ("stimulus"), all of the devaluation of purchasing power of our money, and only a fraction of the growth.