Shrinking Bidenomics: Alarm grows as jobs, GDP data revised downward

President Job Biden’s story about the success of Bidenomics just keeps shrinking.

The Labor Department has consistently overestimated payroll growth predictions under the 46th president and has been forced to revise the data downward to reflect slower economic growth throughout 2023. 

In addition, the Commerce Department significantly revised economic growth downward, dropping last quarter’s Gross Domestic Product by three-tenths of a point from 2.4% to 2.1%.

Experts say the administration’s overly positive economic predictions — especially on jobs — are masking the growing discomfort that every day Americans feel from inflation and rising interest rates.

“The labor force participation rate is the story there. I think it's really because people really are running out of money basically to afford living,” said Alfredo Ortiz, the head of the Job Creators Network, small business lobby.

“So overall, I think people are getting concerned. Employers are starting to kind of put a hold on their hiring practices. They're not necessarily letting people go, but they're also not bringing people in. And so that is all a concern. The trends, I don't think are necessarily being shown in the first release of the estimates,” he added.

Since January, the Labor Department has overestimated seasonally adjusted job growth. The agency initially said the U.S. added 517,000 jobs from December to January, but later revised that number to 472,000, reflecting an overestimate of 45,000.

So far this year, the Labor Department has overestimated job growth by 325,000 positions, according to the latest data available, which focuses on growth from January through June.

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Differences in payroll estimates, Jan. 2023 - June 2023

Madeleine Hubbard/Google Sheets

A particularly egregious overestimate occurred in June when the Labor Department initially said the U.S. gained 209,000 new jobs. That number was later revised down to 105,000, reflecting an overestimate of more than 100,000 positions.

While the Labor Department had overestimated and underestimated payroll employment throughout 2021 and 2022 with overall revisions showing that job growth was underestimated, 2023 is the first year that the Biden administration has consistently overestimated growth.

Under the Trump administration, job growth was higher than expected every year. 

Meanwhile, the unemployment rate grew to 3.8% in August from 3.5% in July, per the Labor Department.

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