There’s a famous scene in the classic western Once Upon a Time in the West (1968) where the character Harmonica steps off a train and is confronted by three gunmen.
When Harmonica asks if they brought a horse for him, one of the gunmen smirks and says, “Looks like we’re shy one horse.”
Harmonica, unbothered, replies, “You brought two too many.”
This reminded me of the big economic news this week. The Bureau of Labor Statistics (BLS) revised nonfarm payroll growth over the past 12 months downward by 818,000 jobs.
In other words, like the gunmen, we overestimated things. The economy created over 800,000 fewer jobs than originally estimated, marking the largest downward revision since the Great Financial Crisis of 2008.
This new data suggests that job growth began to cool earlier than we thought. But there’s some good news: these revisions didn’t make a big impact on financial markets. Even with the adjustment, the economy has created a substantial number of jobs recently, and the overall trend in job growth remains relatively strong.
The bottom line? These revisions are less about raising recession concerns and more about recognizing a shift from very strong growth to simply good growth.