Good morning, investors. There’s a reason that people only want to talk about the job market right now — turns out, it’s in way worse shape than even the most bearish forecasters expected.

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The US labor market just suffered its biggest statistical downgrade in history.

On Tuesday, the Bureau of Labor Statistics erased nearly one million jobs from its books in what stands as the largest preliminary revision on record.

The government now says the economy created 911,000 fewer jobs from April 2024 to March 2025 than previously reported — more than 200,000 deeper than economists expected and more than 2008 crisis levels.

The BLS cut total non-farm payrolls by 0.6% for the period, triple the average revision.

That means the labor market was stagnating long before President Trump’s tariffs or immigration policies entered the picture.

“The frozen job market started way before this summer,” said Heather Long, chief economist for Navy Federal Credit Union.

From April 2024 to March 2025, the government previously stated the US added 1.8 million jobs, a figure the Biden administration touted at the time. The number is now said to be about 850,000.

Monthly payroll gains shrank to about 106,000 in Biden’s final year. That’s significantly less than the previously stated 168,000, and a steep drop from the 216,000 average in 2023 and 380,000 in 2022.

This marks the third year in a row of unusually large negative revisions, erasing more than two million jobs in total. 

That cumulative wipeout helps explain why households consistently reported gloomier views on jobs than official data suggested, as Opening Bell Daily reported Monday.

“President Trump inherited a far worse economy than reported, and he’s right to say the Fed is choking off growth with high rates,” Treasury Secretary Scott Bessent wrote on X after the revision. 

In August, President Trump fired the commissioner of the BLS because he alleged the agency “faked” numbers to help his political opponent.

The data offer further evidence that the Fed has indeed been late on rate cuts, given that it was only last month that Jerome Powell acknowledged the weakening labor market in Jackson Hole. 

Central bankers will take in the August PPI and CPI data before their September 17 meeting, but given the string of troubling jobs numbers, it’s unlikely that hot inflation will stop a rate cut.

Traders see a 25-basis-point rate cut as table stakes next week, though odds are now climbing for a jumbo 50-basis-point move. 

“The consequences of this larger-than-expected revision go beyond intensifying political attacks on the BLS,” said Mohamed El-Erian, chief economic advisor at Allianz.

“They will reinforce the notion that the economy was weaker than reported and that the Federal Reserve faces an even larger risk of being behind the curve on its employment objective.”

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🚀 US stocks hit record highs across the board. The bleak labor market data did not deter investors from piling into equities Tuesday, as the Nasdaq, Dow, and S&P 500 all notched all-time closes.

📱Apple announced its latest iPhone. Shares of the tech name fell in Tuesday trading even as it unveiled a slate of new features and products, including the iPhone 17 and new watches. (Yahoo Finance)

📈 Gold touched new highs once again. Investors continue to position for rate cuts to end the year, and futures for the precious metal hit $3,700 on Tuesday. While gold has climbed 38% this year, the US dollar has weakened nearly 10%. (WSJ)

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I joined Yahoo Finance to discuss the stock market’s earnings momentum, the deteriorating labor market, the outlook for rate cuts, and more:

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📰 I’m Phil Rosen, co-founder and editor-in-chief of Opening Bell Daily. I’ve published books, lived on three continents, and won awards for my journalism, which has appeared in Business Insider, Fortune, Yahoo Finance, Bloomberg and Inc. Magazine.

I write our flagship newsletter to prepare you for each trading day — unpacking markets, economic data and Wall Street with analysis you won’t find anywhere else.

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