Biden Dogged By Unprecedented Revisions That Have Undercounted Almost a Million New Jobs in 2021

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The Department of Labor has undercounted new jobs at record rates under President Joe Biden, leading to several negative news cycles that turned out to be wrong.

Every month, the Bureau of Labor Statistics releases its Employment Situation Report, which generates the headlines based on the number of jobs created the prior month.

But each report also includes revisions to prior months’ totals that don’t get nearly as much attention, if any. As The Washington Post’s Andrew Van Dam pointed out Wednesday, BLS has undercounted the most recent four months by a whopping — and unprecedented — total: 626,000 jobs.

But a review of BLS revisions for the entire year shows eight months in which jobs were undercounted by a whopping 1,022,000 jobs, and one month in which the total was revised downward by 131,000 — a net of 891,000 jobs undercounted.

As Van Dam notes, there are many factors that have contributed to President Biden’s decline in the polls, but missing almost a million jobs could not have helped.

Van Dam offered an explainer on the wild swing in revisions:

Each month’s revisions simply reflect economists’ new best estimate, based on additional data. For example, when businesses report a surprisingly good month, such as this October, the seasonal adjustment algorithms look back on previous months with the benefit of hindsight. A good October likely didn’t come out of nowhere: the August and September estimates probably missed some growth. So, some of the jump in October is assumed to have occurred earlier, and a portion of the October gains are reallocated back to previous months.

These best-guess first estimates are often refined as responses straggle in from more of the 697,000 establishments surveyed each month, including major employers, government agencies and a rotating cast of small businesses. The businesses are asked how many people they employ, how much those people are paid excluding bonuses, and how many hours those are paid for.

In a typical recent month, about a quarter of the responses have come in late. When businesses don’t respond, economists and their models must account for all the reasons a business might not return a survey, including the possibility that it may have suddenly closed up shop. They must also account for newly formed businesses that won’t be on their survey rolls quite yet.

There have been no revisions as yet to October’s jobs report, which saw a greater-than-expected 531,000 jobs created.