U.S. employers added 390,000 jobs in May, representing a robust but slower pace of hiring, according to the Bureau of Labor Statistics’ monthly jobs report released Friday.
The unemployment rate remained at 3.6%, slightly above the half-century low recorded in February 2020, before the pandemic hit.
While the number of jobs added was down from April’s revised total of 436,000, it was better than many expected. The consensus of economists polled by Reuters was for a gain of 325,000 jobs. And while the unemployment rate did not fall to 3.5% as expected, it remained at a level considered full employment by many economists.
The report comes at a time when fears of a recession are growing, in part because the Federal Reserve is raising interest rates in an attempt to tame inflation. Higher rates may cause businesses to forgo plans for expansion and investment, including hiring.
Job gains were widespread, with 69% of industries tracked by the Labor Department adding workers. The main exception was retail trade, the country’s largest sector in terms of employment. In May, there was a net loss of 60,700 retail jobs, according to the report.
Automakers and their parts suppliers also lost 3,500 jobs as factories had to temporarily close or eliminate shifts due to a shortage of computer chips and other materials needed to build cars and trucks. .
The biggest job gains came in the leisure and hospitality sector, which added 84,000 jobs ahead of a strong summer travel season, due to pent-up demand from people wanting to go on holiday .
Employers were able to add jobs despite a shortage of workers seeking employment. There are nearly two job openings for every job seeker, according to a separate Labor Department survey.
The shortage of available workers helped boost average wages in Friday’s jobs report. The average hourly wage of $31.95 was up 5.2% from a year ago. But that was slightly below the rate of increase in five of the last seven months. And that’s less than the pace of price increases consumers are paying for everything from gas to groceries, meaning bigger paychecks aren’t keeping up with inflation.
This story will be updated.
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