WASHINGTON–While signs of an economic slowdown are increasingly being cited by economists, the job market hasn’t gotten the word, as U.S. employers added a robust 390,000 jobs in May, according to new data released today
The unemployment rate was 3.6%, unchanged from April, the Labor Department said. Wages were up 5.1%.
"The jobs report impressed yet again in June, as job gains surpassed expectations and the number of those forced to work part-time due to economic reasons fell sharply,” said NAFCU Chief Economist and Vice President of Research Curt Long. “The story was not all positive, as prior month gains were revised down and the household survey indicated a drop in labor force participation. The latter will likely prove to be a one-off anomaly given that labor demand is still high and recessionary fears are growing. A recession may yet come, but the labor market is pushing hard in the other direction."
CUNA Chief Economist Mike Schenk said the nonfarm employment increase of 372,000 was in line with CUNA economists’ expectations.
"Overall additions were only modestly lower than the gains in both April (+368,000) and May (+384,000). April and May increases were revised down by 68.000 and 6,000 respectively," said Schenk in a statement. "The unemployment rate held steady at 3.6% -- a reading that hasn’t moved over the past four months. The current rate also is in line with the 3.5% pre-pandemic jobless rate.
“Average hourly earnings increased at an annualized rate of 3.6% -- consistent with increases in both April and May. Obviously, a tight labor market increases the threat of a wage-price spiral, but these more modest wage increases in the past several months suggest policy makers may dodge that bullet.
“The labor force participation rate fell to 62.2% from 62.3% in May, and it remains well below the pre-pandemic level of 63.4%," Schenk continued. "The imbalance between labor demand and supply is a key concern, particularly in areas where there are more vacant jobs available than unemployed people.
“Importantly, nothing in the report suggests the Federal Reserve will waver from its commitment to aggressively raise rates in an effort to tamp down inflation expectations.”
Overall Gains
Numerous economists have responded to the newest numbers by predicting they expect the employment market to continue growing.
In all, U.S. employers have added more than 6.5 million jobs in the past year, with many of those gains concentrated in industries such as manufacturing, hospitality and transportation, which are racing to keep up with booming demand, noted the New York Times. That trend continued in May, with broad growth across almost all sectors.