A Horrendous Job Report Looks Even Worse Under the Surface
Buckle up!
The analysis below covers the Employment picture released on the first Friday of every month. While most of the attention goes to the Headline Report, it can be helpful to look at the details, revisions, and other reports to get a better gauge of what is really going on.
Current Trends
The jobs report showed an unexpected loss in jobs of -92k. The Household report was even worse with a loss of 185k jobs, which follows the loss in January of 895k jobs. This paints a very negative picture of the job market.
Figure: 1 Primary Report vs Household Survey – Monthly
The Household Report has been underperforming the Headline report for years. While that changed in 2025, it was primarily due to a one-off data adjustment in January of last year. For the year, the Household Report now shows a loss of over 1M jobs for the year. That is through two months!
Figure: 2 Primary Report vs Household Survey – Annual
The BLS publishes the data behind their Birth/Death assumptions (formation of new business). The data showed that the BLS actually assumed job creation of 90k jobs in February. This makes the headline number even more concerning considering it feels hard to believe enough new businesses formed in Feb to justify 90k jobs. To be fair, this followed January which assumed a job loss of 61k due to birth/death.
Figure: 3 Primary Unadjusted Report With Birth Death Assumptions – Monthly
For the year, the birth death assumption is barely positive of 29k jobs.
Figure: 4 Primary Unadjusted Report With Birth Death Assumptions – Monthly
Digging Into the Headline Report
Unfortunately, despite being highly unreliable, the Headline report is the best data we have for the more recent periods. Furthermore, this is the data the Fed uses to shape its policy. The 92k jobs lost hit every category except “Other”. It was also accompanied by a jump in the unemployment rate to 4.4%.
Figure: 5 Change by sector
Jobs by Category
When looking at the last 12-month trend, you can see that every job category was negative except for Other. Ironically, that category is actually positive over the last twelve months. It is one of only three categories that is positive for the last 12 months. This shows a very weak labor market.
Figure: 6 Current vs TTM
The table below shows a detailed breakdown of the numbers.
Figure: 7 Labor Market Detail
Revisions
This is the biggest story of the jobs report. After all the revisions, the job picture is significantly bleaker than the data originally showed. Not only was every month in 2025 revised down, but 4 of the months had negative growth. January continued the trend, albeit only a modest revision down (so far).
Figure: 8 Revisions
Over the last twelve months, jobs have been revised down by about 76.5k per month!
Figure: 9 Revisions
More Detail in the Household Survey
Another level of detail in the Household report shows full-time vs part-time job holders. The data shows full time jobs being lost over the last two months which is another negative sign.
Figure: 10 Full Time vs Part Time
Historical Perspective
The chart below shows data going back to 1955.
Figure: 11 Historical Labor Market
The labor force participation rate is still well below the highs before the Global Financial Crisis. This month showed it falling to 62%.
Figure: 12 Labor Market Distribution
Conclusion
By every measure, this is a horrendous job report. Job losses are happening across the board. The more troubling story is that the Headline Report is usually much rosier than the truth. As job revisions continue to pull the numbers down, it is likely this 92k gets even worse as more data comes in. We are now in a global conflict with a flailing job market. Buckle up!
QTR’s Disclaimer: Please read my full legal disclaimer on my About page here. This post represents my opinions only. In addition, please understand I am an idiot and often get things wrong and lose money. I may own or transact in any names mentioned in this piece at any time without warning. Contributor posts and aggregated posts have been hand selected by me, have not been fact checked and are the opinions of their authors. They are either submitted to QTR by their author, reprinted under a Creative Commons license with my best effort to uphold what the license asks, or with the permission of the author.
This is not a recommendation to buy or sell any stocks or securities, just my opinions. I often lose money on positions I trade/invest in. I may add any name mentioned in this article and sell any name mentioned in this piece at any time, without further warning. None of this is a solicitation to buy or sell securities. I may or may not own names I write about and are watching. Sometimes I’m bullish without owning things, sometimes I’m bearish and do own things. Just assume my positions could be exactly the opposite of what you think they are just in case. If I’m long I could quickly be short and vice versa. I won’t update my positions. All positions can change immediately as soon as I publish this, with or without notice and at any point I can be long, short or neutral on any position. You are on your own. Do not make decisions based on my blog. I exist on the fringe. If you see numbers and calculations of any sort, assume they are wrong and double check them. I failed Algebra in 8th grade and topped off my high school math accolades by getting a D- in remedial Calculus my senior year, before becoming an English major in college so I could bullshit my way through things easier.
The publisher does not guarantee the accuracy or completeness of the information provided in this page. These are not the opinions of any of my employers, partners, or associates. I did my best to be honest about my disclosures but can’t guarantee I am right; I write these posts after a couple beers sometimes. I edit after my posts are published because I’m impatient and lazy, so if you see a typo, check back in a half hour. Also, I just straight up get shit wrong a lot. I mention it twice because it’s that important.
The yield curve had already been signalling problems in the US economy many months ago. Historically, such a prolonged inversion has almost always preceded a recession.
What likely delayed the downturn was the unusually large fiscal expansion of the past two years. Massive government spending temporarily masked the slowdown despite very tight monetary policy.
From an Austrian perspective, this situation also reflects the consequences of decades of artificially low interest rates. According to Austrian Business Cycle Theory, prolonged monetary expansion inevitably leads to widespread malinvestments that only become visible once financial conditions tighten.
The yield curve may have been the bond market recognising these imbalances earlier than the official data.
Given current oil prices and weakening labour data, it would be quite surprising if the US economy could avoid a recession from here.
AS I HAVE PREVIOUSLY STATED NUMEROUS TIMES- unless we use realistic inflation statistics (such as John Williams "Shadowstats") we get totally false "pictures" of the economy. Using such figures we can see that the US economy has essentially been in PERMANENT RECESSION ever since the GFC. Ergo - large job loss figures starting to show up when businesses finally realize that, for all the "phony" inflation-induced revenue, they're not actually making any profit, that the owner(s) aren't making a "living" (in spite of their 80-hour weeks).