By Alicia Wallace, CNN
(CNN) — This Wednesday marks a pivotal moment as we receive our initial insight into the state of the United States job market at the outset of 2026, alongside a more comprehensive understanding of hiring trends from 2025.
The Bureau of Labor Statistics (BLS) is poised to unveil the January jobs report at 8:30 AM ET. This essential employment summary comes slightly later than anticipated due to a brief government shutdown and will indicate whether the stagnant performance of the labor market has finally shown signs of revitalization.
The previous year marked a significant downturn in job creation, revealing the weakest performance since 2003 outside of a recession.
As the year concluded, the economy recorded the addition of 50,000 jobs in December, which aligns closely with the average monthly gains seen throughout the year. The unemployment rate also dipped to 4.4%, according to BLS figures.
“Countless workers feel ensnared in their careers or excluded from the job market altogether,” noted Daniel Zhao, chief economist at employment platform Glassdoor.
The much-needed dynamism typically essential for a robust labor market has notably diminished, resulting in a greater number of job seekers than available positions.
The January jobs report will also incorporate significant revisions, particularly the annual benchmark revision, along with statistical modeling adjustments that will not only provide a clearer retrospective view of employment patterns but may also inform perceptions of current and future market dynamics.
Anticipation is high for Wednesday’s revelations; here’s a brief overview to facilitate understanding:
What are the expectations for hiring and unemployment in January?
In summary: anticipate continuity. Economists forecast that monthly job gains may hover around the 50,000 mark as we enter this new year.
The recent influx of labor market statistics—both public and private—suggests an elevated probability of tepid job growth, a stagnant unemployment rate, alongside a healthcare sector that remains pivotal in driving overall employment.
Seasonal and climatic factors may yield a more optimistic outlook for January; lower-than-expected holiday hiring has curtailed post-holiday layoffs, and warmer weather early last month could have bolstered employment in sectors such as construction.
Economists project a job gain of approximately 80,000 for the prior month, while the unemployment rate is expected to remain steady at 4.4%, as reported by FactSet.
Why have job gains been relatively sluggish?
A confluence of factors is influencing this lackluster growth.
On the supply side, an aging Baby Boomer workforce is retiring, population growth has decelerated, immigration numbers have sharply contracted, and there’s been an uptick in deportations.
Conversely, on the demand side: substantial employers are streamlining their workforces after excessive hiring during the pandemic; heightened uncertainty—especially surrounding the abrupt and sweeping domestic policy shifts under the Trump administration—has clouded corporate decision-making and stymied hiring; businesses are diverting resources away from staffing towards equipment and technology investments (including artificial intelligence) to boost productivity; and an unfavorable economic climate plagued by elevated costs, significant tariffs, cuts in federal funding, and stringent immigration policies have hampered various sectors.
Joe Brusuelas, senior economist at RSM US, emphasized these dynamics, countering White House economic advisor Kevin Hassett’s assertion that subdued job creation primarily results from demographic shifts and increased productivity.
“Attributing slower hiring solely to demographic trends is unsatisfactory and serves to distract from the real effects of immigration and trade policies—consider the 72,000 decline in manufacturing jobs last year, which will likely appear worse following the forthcoming benchmark revision,” Brusuelas stated.
What precisely is a benchmark revision?
Federal employment data is inherently dynamic and often subject to adjustments as more refined information surfaces. The BLS’s monthly jobs report aims to offer a timely glimpse into labor trends, albeit at the cost of some accuracy.
To compile this monthly employment snapshot, the BLS surveys around 121,000 employers, encompassing 631,000 work sites—over a quarter of total employment. These respondents have three opportunities to report payroll fluctuations for any given month.
Each year, the BLS embarks on a process designed to yield a thorough count of employment by reconciling monthly survey estimates with data from the Quarterly Census of Employment and Wages program, which encompasses roughly 95% of US jobs.
The QCEW offers a more accurate representation of businesses, employees, and wages across the nation, as its data is derived from state unemployment insurance tax records that most employers are mandated to submit.
However, this process comes with a considerable lag: last year’s third-quarter data will not be released until next month.
Wasn’t there a significant revision last September?
Indeed, that was the preliminary benchmark revision—an initial estimate coinciding with the release of first-quarter QCEW data.
In September, the preliminary revision suggested that the US economy likely added approximately 911,000 fewer jobs than previously estimated over the twelve-month span from April 2024 to March 2025.
Distributing that over time yields about 76,000 fewer jobs monthly. If the preliminary data holds, it could effectively halve reported job gains for that timeframe.
Does this imply the BLS is ‘cooking the books’?
No, the benchmarking process and subsequent adjustments to past employment figures do not indicate any misleading practices, contrary to the unfounded claims made by President Donald Trump and others.
In fact, this procedure has been undertaken by the BLS for nearly 90 years. In the words of former BLS commissioner Erica Groshen, it’s “not a bug; it’s a feature.”
These revisions illustrate how a transparent and regulated organization adapts and adjusts for new information as it becomes accessible, as noted by Groshen and other former BLS officials in past dialogues with CNN.
Should it remain consistent—with historical trends indicating that final adjustments are typically smaller—it would represent the largest downward revision since the BLS began recording in 1979, as evidenced by BLS data.
Didn’t we experience a substantial revision last year? Why are they so considerable?
Economists anticipate that the final adjustment might reflect a downward revision of 700,000 jobs.
At this time in the previous year, the final benchmark figure for the twelve months concluding in March 2024 indicated a reduction of 589,000 jobs seasonally adjusted (-598,000 when seasonality is not factored in).
This figure is markedly narrower than the preliminary estimate of -818,000 jobs, which continues to resonate despite not being the final count.
The conclusive tally of nearly negative 600,000 constituted the largest downward adjustment since March 2009 (previously the largest revision on record, standing at minus 902,000) and surpassed the downward adjustment of 489,000 jobs for the twelve-month period ending March 2019 (during Trump’s initial term).
For context, these adjustments constitute a minuscule fraction (tenths of a percentage point) of overall employment.
Nonetheless, such significant fluctuations—whether positive or negative—typically manifest during periods of economic transformations that swiftly alter dynamics at a pace not captured by conventional models.
Factors likely contributing to the anticipated downward revision include: diminishing response rates in surveys, problems with the BLS’s business creation model, known as the birth-death model, distorted by pandemic effects, and discrepancies related to immigration measurements.
“This has been a half-decade of tremendous economic change due to both the pandemic and the shifts in immigration patterns,” remarked Jed Kolko, an economist and former Under Secretary of Commerce for Economic Affairs during the Biden administration.
What are statistical model adjustments?
The benchmark revision—which ultimately affects 21 months of seasonally unadjusted data from April of the preceding year through December of the following year—is not the only adjustment forthcoming in this release.
Due to the BLS’s focus on existing employers, businesses that open or close may be overlooked in their surveys. To address this, the BLS developed the “birth-death” model to account for these fluctuations.
The BLS has refined its birth-death model and will retroactively adjust previous data generated under the earlier model.
The agency also typically revises its seasonal adjustment models with each benchmark revision, impacting the prior five years of seasonally adjusted information.
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