The White House on Friday cited the May jobs report as evidence that the labor market's robust, while Congressional Democrats called it weak. While labor conditions are softening, a deep dive into the report shows any weakness started long before the Trump administration, which is making undeniable progress reprivatizing the economy.
Under President Biden, the government accounted for a disproportionate number of new jobs as runaway government spending and hiring artificially inflated the labor market figures. Now, the situation has completely reversed as the Trump administration wages an all-out war on government waste, including the bureaucrats.
The number of jobs in the federal government (excluding the postal service) has now fallen every month this year, bringing the number of federal payrolls down to the lowest level since November 2023. A whole year’s worth of burgeoning bureaucracy has been undone in a few months, and the war on waste continues.
The decline in the federal workforce offset all the gains in state and local government, so that overall government payrolls are now flat since President Trump took office in January. That means all job growth this year has been from the productive private sector—a stark change from the Biden years.
To illustrate how government hiring was buoying a long-stagnant labor market, May was the first month since August 2023 that the government was not either the first or second largest contributor to annual job growth by sector. Many so-called blockbuster jobs reports under Biden were just government hiring sprees—at taxpayer expense, of course.
But this latest jobs report also shows the labor market is still struggling. The labor force participation rate (LFPR) and the employment-to-population ratio both declined in May as the survey of households showed that almost 700,000 fewer people were employed, with 600,000 of them leaving the labor force.
Both the LFPR and the employment-to-population ratio peaked in 2023 (never returning to pre-pandemic levels), then began trending down erratically. Conveniently, Democrats ignored these troubling trends and only now are raising their concerns about the labor market.
Similarly, the number of full-time jobs plateaued in June 2023 and did not breach that highwater mark until this year. All the net-job growth in the meantime was part-time work. In May, the economy once again shed full-time jobs and only added part-time ones. However, compared to May 2024, full-time employment is up more than 1.5 million, so it’s certainly not all bad news.
Another bright spot in the jobs report was found in who’s getting the jobs being created: native-born Americans. When Biden left office in January 2025, there were fewer Americans employed than five years prior in January 2020 right before the pandemic, with all the net job growth during those five years going to foreign-born workers.
Under the Trump administration, average annual job growth for native-born Americans has outpaced that for foreign-born workers. In May, almost 1.4 million more native-born Americans had jobs compared to one year prior, while jobs among foreign-born workers increased by less than half that.
So yes, this latest jobs report has good and bad, but there’s also something ugly—and worrisome—in the statistics.
The Labor Department’s figures show the economy added 139,000 jobs in May, but the April and March numbers were revised down heavily by a total of 95,000. That means two-thirds of the payrolls added in May were jobs we thought the economy already had.
Large downward revisions became a trend under Biden and are continuing. To be clear, revisions are a normal part of the monthly job reports, but they became abnormal during the last administration, and nothing was done to fix the problem.
In 2022, it was clear that the monthly job reports were grossly—and consistently—overstating the growth of nonfarm payrolls in the initial estimates, and the Bureau of Labor Statistics has yet to fix the issue. Recent forecasts from the Federal Reserve Bank of Philadelphia indicate that job growth in the middle of last year will need to be revised down even further by half a million.
It's unacceptable that these data are unreliable when major market movers (including the Federal Reserve) depend on the accuracy of these figures when making consequential decisions. The Labor Department needs to address this ugly issue immediately so we can better assess if future job reports are good or bad.
E.J. Antoni, Ph.D., is the Chief Economist and Richard Aster fellow at the Heritage Foundation and a senior fellow at Unleash Prosperity.
Join the conversation as a VIP Member