Benchmark Revisions to the Current Employment Statistics (CES)

The establishment survey of the CES report gives a real-time estimate of employment and wages in the economy. Because it is survey-based, and because it is particularly difficult to estimate the number of jobs gained and lost from new businesses opening and others closing​, the CES data is subject to important revisions. The Quarterly Census of Employment and Wages (QCEW) is a collection of employment and wage data based on tax filings from businesses, and it represents the most complete set of data collected; however, it is reported with a sizable lag.

Once per year, the US Bureau of Labor Statistics (BLS) benchmarks the CES data to match the more complete QCEW data. Yesterday’s report, which coincided with the release of Q1 2024 data from the QCEW, provided preliminary estimates of the benchmark revisions to the CES data, which will be incorporated into the data in February of 2025.

Latest Benchmark Revisions

On August 21, the BLS reported that the CES data overestimated nonfarm employment between April of 2023 and March of 2024 by 818,000 jobs, or roughly 68,000 jobs per month. According to Bloomberg’s survey, economists were expecting a negative revision in the range of 600,000 to 1,000,000 jobs, so the actual print is right in the middle of expectations.

We won’t know the monthly distribution of the revisions until February of 2025. However, if we assume an even monthly distribution, average monthly employment growth in 2023 will have declined from around an estimated 250,000 jobs per month to around 200,000 jobs per month. For 2024, year to date, average monthly job gains will have declined from around an estimated 200,000 per month to around 175,000 per month. (Note that the average differences for each year are less than 68,000 and differ for the two years, because only some months from each year are subject to the revision.) These revised numbers show a less robust labor market than the initial estimates suggested, but they still represent solid job growth in the economy for each period.

Impact on Workers Compensation

The direct effect of the revision on workers compensation is an adjustment to the estimated size of the market based on leading labor market indicators. It’s important to note that there is no actual impact on premiums collected for the industry. These are jobs that never existed and were not counted in policies. Additionally, NCCI uses the more complete QCEW data on employment and wages in its ratemaking process rather than the CES estimates.

For a monthly review of how trends continue to change in the labor market, check out NCCI’s Labor Market Insights [link.mediaoutreach.meltwater.com] report. Connect with our Economics Team to learn more.

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