The number of jobs rose by 339,000 in May, beating expectations and pointing to a resilient labor market.
The US economy continued to create jobs in May, despite the macroeconomic challenges. Non-farm payrolls rose to 339,000, significantly beating Dow Jones’ forecast of 190,000, and as a result, May marked the 29th consecutive month of positive job growth in the country.
According to the US Bureau of Labor StatisticsAnd although the unemployment rate rose to 3.7% compared to the estimated 3.5%, the labor market remained strong. Similarly, average hourly earnings increased 0.3%, as expected, while annual wages increased 4.3%, just short of estimates.
The term “payroll” refers to the total number of employees who receive a salary or wages during a specified period. This metric is used to assess the strength of the labor force and job creation in an economy.
The US labor market is defying economic challenges with strong job growth
Becky Frankovich, President and Chief Commercial Officer of Manpower Group, an American Fortune 500 multinational corporation headquartered in Milwaukee, Wisconsin, highlighted The resilience of the US labor market amid economic challenges such as inflation and layoffs.
The US labor market continues to show resilience amid various challenges, from inflation to high-profile layoffs and rising gas prices. With 339,000 jobs, we’re still rewriting the rulebook, and the US labor market continues to defy historical definitions,” Frankovich said.
The Ministry of Labor indicated that professional and commercial services led job creation with 64 thousand jobs, followed by the government with 56 thousand jobs, and the health care sector with 52 thousand jobs.
The unemployment rate is of concern despite the positive trends in the labor market
Not all news in the labor sector was positive, as the unemployment rate continued to rise significantly by 0.3% to reach 3.7% (6 million unemployed), due to the decline in the self-employed.
The unemployment rate rose 0.3 percentage point to 3.7 percent in May, and the number of people out of a job also increased by 440,000, to 6.1 million. The unemployment rate has ranged from 3.4 percent to 3.7 percent since March 2022.” is reading Press release on employment status.
Although some US politicians predict a recession in the future, as is already happening in some European countries such as Germany, US consumers continue to spend, and the flexible labor market continues to support spending.
Despite the growing concerns expressed by experts and officials within the Federal Reserve, the central bank continues to push interest rates higher as a way to address persistent inflationary pressures. However, these measures did not achieve the desired result and may pose greater challenges in the long term.
Therefore, despite the increase in jobs to 339,000 in May, it is likely that the Fed will continue to implement its aggressive policy of economic tightening in the coming months, or at least until a significant improvement in inflation indicators is observed.
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