The preliminary benchmark revision of -911K amounts to -0.6% to March 2025 payroll employment. Combined with 2-month revisions, recent total revisions are big but hardly unprecedented, & smoothed over the business cycle the payroll survey has gotten more accurate over time.

The larger-than-usual downward revision last month was in large part driven by a negative skew in the job growth distribution among late reporting firms. That’s unusual, but it’s happened before when the pace of job growth slows rapidly. This print is more evidence that was the case

New @budgetlab.bsky.social tariff analysis incorporating all tariffs through Sept 3. This is a major update. We: • incorporate higher assumptions about Canada & Mexico tariff-free import shares; • show 2 scenarios: all tariffs & no IEEPA tariffs after Jun 2026. In brief... 1/12

We have a new @budgetlab.bsky.social report out today looking at the short-run effects of tariffs so far. Basically, we asked the questions, "What do we see in actual data to date, and how does it compare to our priors." In brief... 1/13

New @budgetlab.bsky.social tariff analysis incorporating all 2025 tariffs through today, including the higher 50% rate on India. In brief... 1/10

New @budgetlab.bsky.social tariff analysis incorporating the Administration's new list of "reciprocal" tariffs published last night and going into effect August 7, as well as maintaining the 25% rate on Mexico. In brief... 1/10

New @budgetlab.bsky.social tariff analysis incorporating the 25% tariff on India, up from our previously-assumed 10% and which goes into effect August 1. In brief... 1/10

New @budgetlab.bsky.social tariff analysis incorporating the 15% EU tariffs, down from our prior 30% assumption. In brief... 1/10

New @budgetlab.bsky.social tariff analysis incorporating policy through July 22, including the new "reciprocal" tariff rates on Japan, Indonesia, and the Philippines, which go into effect August 1. In brief... 1/10

New @budgetlab.bsky.social tariff analysis incorporating the 30% Mexico & EU tariff rates, which, like the rest of last week's letters and the 50% copper tariff, go into effect August 1. In brief... 1/10

New @budgetlab.bsky.social tariff analysis incorporating the 35% Canada tariffs, which go into effect August 1 (along with the 22 letters and the copper tariffs). In brief... 1/10

New @budgetlab.bsky.social tariff analysis incorporating 1) the 50% copper tariff, and 2) the July 7 & 9 letters to 22 countries with new "reciprocal" tariff rates. Both go into effect August 1. In brief... 1/10

New @budgetlab.bsky.social tariff analysis incorporating 1) the US-Vietnam framework announced July 2, and 2) the July 7 letters to 14 countries with new "reciprocal" tariff rates, which go into effect August 1. In brief... 1/10

Initial claims fall to 227K NSA, expected this week in summer & almost exactly in line with 2018, 2019, 2023, & 2024 (1st chart). Initial claims a smidge *below* those years as a share of employment (2nd). Continuing claims as a share of employment a smidge *higher* (3rd).

@budgetlab.bsky.social tariff update through June 16, incorporating: • Broader scope for the 50% steel & aluminum tariffs to include some steel-derivative products. • Relaxation of Chinese export restrictions on magnets & rate minerals. • New distributional methodology. 1/9

New analysis from @budgetlab.bsky.social: if you combine the distributional impact of tariffs so far with CBO's new OBBBA distribution, the bottom 80% of households see a decline in income, and the 9th decile is close to neutral. Only the top 10% see a clear net benefit. 1/3

Initial claims jump to 245K NSA, as would be expected this time of year. Claims still w/i the band of recent non-recessionary years, both in headcount terms (1st) & normalized to employment (2nd). Continuing claims however undoubtedly higher, though not substantially so far (3rd)

Two new pieces from @budgetlab.bsky.social (links at end). First, TBL finds that the rise in interest rates associated with OBBBA will raise consumer & business costs. E.g., by 2030, the annual mortgage payment on a typical home purchase would rise by >$1,000, & by $4,000 by 2030. 1/3

The US Employment Situation, May 2025 Payrolls: +139K 3MMA: +135K 2M revisions: -95K Unemployment Rate: 4.2% (no change)

@budgetlab.bsky.social tariff update is out, incorporating 1) reinstatement of the IEEPA tariffs, given the appeals court stay of the USCIT ruling; 2) the 50% steel & aluminum tariffs announced by the Administration; 3) recent increases in USMCA-compliant trade with Canada. 1/8

Yesterday's US Court of International Trade decision invalidates the recent tariffs imposed under IEEPA, including the "reciprocal" tariffs & most tariffs on China, Canada, & Mexico, leaving only the Section 232 commodity tariffs in place. What are the economic implications? 1/8

Assuming that the US raised the "reciprocal" tariff rate on the EU from 10% to 50%, what would be the economic effect? The 1st table takes current tariffs & illustratively raises the EU reciprocal rate to 50% total. For comparison, the 2nd shows w/o the extra EU tariff. 1/7

Full @budgetlab.bsky.social report: budgetlab.yale.edu/research/sta...

Assuming that the US raised the "reciprocal" tariff rate on the EU from 10% to 50%, what would be the economic effect? The 1st table takes current tariffs & illustratively raises the EU reciprocal rate to 50% total. For comparison, the 2nd shows w/o the extra EU tariff. 1/7

Read the new report from @budgetlab.bsky.social that scores the budgetary effects of the May 2025 Tax Bill. budgetlab.yale.edu/research/bud...

New tariff update today from @budgetlab.bsky.social incorporating 1. Today's announcement of lower US-China tariffs (10% instead of 125% reciprocal tariffs); 2. The May 8 US-UK trade deal; and, 3. The April 29 auto tariff rebate announcement. Some high level takeaways: 1/13

@budgetlab.bsky.social back in September originally estimated that a FLSA overtime deduction would cost $866 billion over 10 years, without any assumed income limits or overtime caps, and would cost $1.3 trillion if structured as an exemption applying to both income & payroll taxes.

Initial claims come in slightly above prior non-recessionary years, both in headcount (1st) & share-of-emp (2nd) terms. Initial claims are ~19K above where they were same week in 2019. Not a catastrophe but it's notable. Continuing claims slightly above recent years too (3rd).

Advance estimate of US Real GDP 2025 Q1: -0.3% SAAR. Private Domestic Final Purchases, or "Core GDP" (just consumption and business investment) rose by 3.0% SAAR. Durables PCE & net exports collapsed. Services PCE & business investment healthy. Big build up of inventories.

Hello, EconSky! We are hiring a lead economist at CAP. My DMs are open if you want to talk through the position and CAP generally. Crucially, we are right next to a great bubble tea spot. www.americanprogress.org/job/senior-f...

Master and Commander/TNG Intro this was rendering all day while I was out lol

@budgetlab.bsky.social's Tariff Tuesday continues with an update through April 15 reflecting: • China retaliation upped to 125% • China importing export controls on certain minerals & magnets • Clarification on the semiconductor exemption Some high level takeaways: 1/8

Given clarifications from the Administration about the China tariffs, @budgetlab.bsky.social has updated its estimates to reflect a 145% maximum China rate from 2025 policy versus the 125% we assumed before. The report link is the same. Some key takeaways... 1/7

We've updated our @budgetlab.bsky.social tariff estimates in light of yesterday's announcement of a 90-day 10% "reciprocal" tariff and a 125% China tariff. Some key takeaways... 1/7

One important thing to note. Yesterday's report had revenue at $3.009 trillion. Now, with the add'l 50% tariffs on China, it's $2.843 trillion. We've now flipped to the right side of the tariff Laffer Curve.

Here's a quick update to the @budgetlab.bsky.social tariff tracker to incorporate the add'l 50% US tariffs on China & China's add'l retaliation. • The average effective US tariff rate is now 26.8%, the highest since 1903. • US real GDP growth is -1.1pp lower over 2025. 1/3

@budgetlab.bsky.social is starting a regular Tuesday "State of US Tariffs" report that shows the bottom-line effects of all 2025 US tariffs & retaliation implemented to date or in the week ahead date certain. This week's update incorporates the 34% China retaliation. 1/4

The US Employment Situation, March 2025

New @budgetlab.bsky.social report about today's tariff announcement: • The April 2nd policy alone is the equivalent of an 11.5pp increase in the effective tariff rate. When combined with other US tariffs in 2025, we're at 22 1/2%, the highest rate since 1909. 1/7

Over the weekend, the @wsj.com reported that the Administration was considering a 20% broad tariff for its April 2 announcement. A 20% tariff would... • if combined with this year's other tariffs, raise the effective US tariff rate to 33%, the highest since 1872. 1/4

The 25% automobile tariffs: • increase auto prices by 13.5%, the equivalent of $6,400 on the average new car. • **reduce** US auto production & increase Chinese auto production in the long-run if other countries retaliate to our tariffs. • Reduce long- & short-run US GDP 1/2

Important new work from my @budgetlab.bsky.social colleagues Harris Eppsteiner & John Ricco on the House budget resolution. Neutral illustrative policies consistent w/ committee deficit targets suggest the proposed tax + spending cuts are regressive: they benefit the top & hurt the bottom. 1/3

Some professional news, as they say. (I have acquired some more gray in my beard since that photo was taken, I must confess.)

@marthagimbel.bsky.social and I are in @hbr.org with thoughts about how to navigate these periods of chaotic vibes and economic uncertainty with a hard head: “Keep calm and watch the data.” 1/2

Still not compelling evidence of lower federal spending from last year. Overall noninterest spending YTD is running ahead of 2023 & 2024 (left). If you take out the big COLA'd programs & also FDIC (which skews comparisons to last year due to SVB), 2025 still ahead of 2024 (right)

1Y Inflation expectations in the preliminary UMich survey shoot up to 4.9%, almost as high as their pandemic peak. Even more incredible is long-run 5-10 year inflation expectations, which jumped to 3.9%, the highest since 1993 and well above even the worst of the pandemic.

Overall initial claims look more normal this week. Slight tick up in the insured unemployment rate which is the equivalent of an extra 90,000 people on continuing UI rolls in 2025 relative to 2024. Federal employee initial claims still elevated at 1,580.

Grateful for the discussion of new @budgetlab.bsky.social research by @colbylsmith.bsky.social. Deficit-financing can sometimes make sense, but it comes with deep trade-offs. It adds price pressures & higher interest rates that raise living costs. We tried to make those trade-offs more concrete. 1/4

I’m in @opinion.bloomberg.com today with the story of how 3 recessions, 2 wars, & several rounds of tax cuts ruined the low-debt fiscal trajectory we had in 2000. The wars & recessions have passed but the tax cuts remain & now we can’t afford them. Revenues need to be on the table.

Initial claims running about 15-25K ahead of the same week in prior recent non-recession years; overall number still low in absolute term. Big jump in federal employee claims. More likely than not that federal layoffs are now beginning to weigh on the data. Next ? is tariffs.