US labor market not as dynamic as before

Employment in the US is increasing less dynamic than before.

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Bernd Weidensteiner

Commerzbank Economic Research

09/15/2025

In addition, past payroll data have been revised down significantly as part of the annual benchmark revision. Nevertheless, the unemployment rate has risen only slightly, as not only demand for labor has weakened, but also supply. Projections for employment trends suggest that a return to much higher payroll growth is not to be expected in the long term.

Labor demand is weakening...

The recently published benchmark revision. shows that the number of non-farm jobs in March 2025 was 911,000, or about 0.6%, lower than previously reported. Taking the revision at face value, employment would have risen by only 73,000 on average between April 2024 and March 2025. Before the revision, the average monthly increase had been reported at just under 150,000, which is more than twice as high. In the months since March, job growth has been even lower, averaging 53,000. At the same time, the number of job vacancies has fallen by almost 40% since the beginning of 2022 to around 7.2 million. This also points to a significant cooling of labor demand.

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