The U.S.-born employment and population boom that wasn't

The best single measure of the health of the job market is probably the employment-population ratio for ages 25 through 54. The unemployment rate can be pushed downward when times are bad by people giving up on looking for jobs and upward when times are good by the opposite. The overall employment-population rate is being pushed downward at the moment by the aging of the U.S. population. Prime-age Epop, as it’s known, avoids all those distortions.

How is the job market looking for prime-age native-born Americans? Pretty good. Their prime-age Epop was 81.5% in November, the same as in November 2024, only slightly lower than the 81.8% in November 2023 and higher than in any other November since 2007, which is how far back these statistics are available. The Bureau of Labor Statistics does not adjust these numbers for seasonal factors, which is why there’s a cyclical up-and-down pattern and why I’m comparing with other Novembers rather than, say, last January.

The population of native-born Americans ages 25 through 54 probably increased by a bit less than 100,000 over the past year. That’s based on (1) Census Bureau estimates of the U.S. population by single year of age in 2024, (2) Centers for Disease Control and Prevention mortality statistics and (3) data from the Census Bureau’s 2024 American Community Survey on the percentages of various age groups that are native-born. It ignores net immigration of native-born Americans and the fact that the BLS excludes active-duty military and people in prisons and other institutions from its calculations, but I don’t think including either of those would change the picture much. Last month’s prime-age native-born Epop was, if you take things out another decimal, slightly lower than the one in November 2024 (81.51% compared with 81.53%), so if you multiply those times my population estimates, you get an increase in native-born prime-age employment of about 40,000.

So why do the BLS statistics say that employment is up by 2.4 million since November 2024 and 2 million since January 2025 for prime-age native-born Americans and 2.6 million and 2.7 million, respectively, for native-born Americans overall? The Trump administration and its allies understandably keep trumpeting these numbers, but they’re clearly wrong. Behind their inaccuracy is an interesting and somewhat disconcerting story and, while I’ve told a version of it once already, I keep seeing so many questions and misstatements about the numbers that another run-through seems to be in order.

The story does not involve Trump administration officials manipulating the statistics. What instead seems to be causing the inaccuracies is the interaction between the way BLS estimates population levels for the Current Population Survey as part of its monthly jobs report and a sudden shift in survey responses that can almost certainly be chalked up to the administration’s aggressive deportation campaign.

The headline statistics derived from the CPS, a survey of 60,000 households, are percentages such as the unemployment rate, labor-force participation rate and employment-population ratio. Another part of the monthly jobs report provides numerical estimates of payroll employment derived from a survey of employers and later checked against state unemployment-insurance records. There the aim is to provide, after lots of revisions, consistent and accurate long-term data series of how many people are employed in specific industries and locations. With the CPS it’s the percentages that are intended to be consistent and accurate over time, with the estimates of employment and population levels provided mainly so data users can calculate their own percentages — such as the prime-age native-born employment-population numbers in the above chart.

The CPS population numbers are updated each year with the January jobs report (which comes out in February) to reflect the latest annual national population estimates from the Census Bureau. Past statistics aren’t revised, so year-over-year comparisons of the levels of population are always misleading. Between the annual revisions, population is updated based on monthly population projections made by the Census Bureau at the end of the previous year. But for many subgroups, including the foreign-born and native-born populations, the monthly estimates vary with responses to the household survey — and there’s been a sudden drop this year in the percentage of CPS respondents who say they’re foreign-born. The employment levels reported by the BLS are basically just the population levels multiplied by percentage statistics from the household survey, so any flaws in the population numbers are passed through to the employment numbers,

The population numbers show a decline of 1.9 million, or 1%, since March in the foreign-born 16 and older population. How much of this drop represents immigrants actually leaving the U.S. and how much is due to them avoiding the CPS survey-takers or saying they’re native-born is not clear. The Department of Homeland Security said earlier this month that "more than 2.5 million illegal aliens" had left the country since Jan. 20, with 605,000 deported and 1.9 million "self-deported." That second number is I think mainly just a hopeful guess, and with legal immigrants continuing to arrive the latest forecast (as of September) from the Congressional Budget Office was that net immigration would be positive 409,000 this year.

It is at least possible, though, that the 16-and-older immigrant population has declined by 1.9 million since March. The 5.3 million increase since December in the BLS estimate of the native-born 16 and older population and 2.7 million increase in the prime-age population are impossible — millions of native-born adults can’t just suddenly appear. I’ve already discussed my estimate that the prime-age native-born population probably increased by less than 100,000 over the past year. For ages 16 and older, my best guess is that the native-born population increased by a bit more than 2.5 million, which is still a lot less than 5.3 million.

Of the purported 5.3 million increase in the native-born population, 1.5 million came in the annual January population adjustment. The rest has been the product of (1) projections that the civilian noninstitutional population would grow by almost 2 million from January to December and (2) survey results showing an increase in the percentage of that population that is native-born. That is, with population locked in to grow by a predetermined amount over the past year, declines in the foreign-born population share automatically translate into increases in estimates of the native-born population (and, by extension, native-born employment.)

This increase has been concentrated among Hispanic or Latino respondents; according to the BLS, there were 3.6 million more Hispanic or Latino native-born 16-and-older Americans this November than there were last December — with 1.5 million added in the January population adjustment and 2.1 million since.

Obviously 2.1 million new native-born Hispanics 16 and older did not suddenly appear in the U.S. since January, and I take this statistic as an indication that many Hispanic Americans who aren’t born in the U.S. are telling CPS survey-takers that they are. Given the ways in which federal immigration agents have been targeting Hispanics, including those here legally and even U.S. citizens, can you blame them? But one result is population and employment statistics that, at least until the next round of Census Bureau population estimates are incorporated in February (and possibly still after that), are telling an impossible story.

This column reflects the personal views of the author and does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners. Justin Fox is a Bloomberg Opinion columnist covering business, economics and other topics involving charts. A former editorial director of the Harvard Business Review, he is author of "The Myth of the Rational Market."