July’s jobs report came with stunning revisions to data that the U.S. Department of Labor had previously reported for May and June.

Why it matters: Along with static hiring in July, the numbers for the previous two months point to danger ahead for the U.S. economy.

Driving the news: Employers added just 73,000 jobs to their payrolls last month. The Labor Department also announced huge downward revisions for job growth in May and June.

• The economy added just 19,000 in May, not the 144,000 the government previously reported.
• June job gains were revised down to 14,000 from the 147,000 first estimated.

That means employment over the prior two months was 258,000 lower than previously reported.

• It is among the largest two-month revisions ever, second only to May 2020 in the aftermath of the pandemic shock.

Here’s what to know about the revisions:

How the Bureau of Labor Statistics releases data

How it works: The Bureau of Labor Statistics (BLS), a nonpartisan statistical agency within the Labor Department, releases the jobs report on the first Friday of each month at 8:30 am ET.

• It’s one of the most important pieces of economic data that can move financial markets globally.

State of play: The reports look at the change in employment from the previous month, a figure that is updated twice more in as many months.

• The agency revises the numbers after evaluating information that wasn’t available at the time of the initial report.

Why the BLS revises data

By the numbers: BLS officials survey about 629,000 work sites to project the nationwide estimate for how many jobs have been created or lost.

• Sometimes, however, businesses don’t respond before the report is released. The BLS continues to take reports from those businesses, which inform the revisions published in the following two months.
• The unemployment rate, however, is not revised monthly.

What they’re saying: The BLS’ initial reported data is “the quick, but lower resolution snapshot of what went on in the job market for a particular month,” agency officials wrote in 2012.

• The revisions, which have been conducted since 1979, can be so large that they change the perspective of the current state of economy, especially if a large company is late to report payrolls data.
• The Labor Department also recalculates seasonal factors, a statistical quirk that aims to remove the seasonal patterns — weather, holidays school schedules and the like — that can influence employment trends.

One unique factor this year: shifting population trends that might be warping the data.

• President Trump’s immigration and deportation policies are changing how many people are in the labor force, or in other words, have a job or are looking for work.

What to watch: There are also annual revisions to job figures, which are also based on more complete information after it becomes available.

• The BLS adjusts its estimates for payrolls to reflect official tax data that wasn’t available at the time of initially reporting monthly numbers.
• The revisions can be significant: The first for 2024 showed the economy added 818,000 fewer jobs in the 12 months through March.

Revisions aren’t partisan, or a conspiracy

Flashback: Public figures and social media commentators have previously suggested that the monthly jobs figures are “fake,” pointing to the revisions as evidence.

• Yes, but: There’s no conspiracy. The revisions aren’t political — they’re a form of more thorough data collection.