US adds 339K jobs in May; unemployment jumps to 3.7%

Total nonfarm payroll employment increased by 339,000 in May, and the unemployment rate rose by
0.3 percentage point to 3.7 percent, the U.S. Bureau of Labor Statistics reported today. Job gains
occurred in professional and business services, government, health care, construction, transportation and warehousing, and social assistance. …

The unemployment rate increased by 0.3 percentage point to 3.7 percent in May, and the number of
unemployed persons rose by 440,000 to 6.1 million. The unemployment rate has ranged from 3.4
percent to 3.7 percent since March 2022.

The labor force participation rate held at 62.6 percent in May, and the employment-population ratio,
at 60.3 percent, was little changed.

[So far, job creation hasn’t been much impacted by the Fed’s rate hikes. Now that the banking system is at risk over the rapid rise in interest rates, the Fed may not be able to do much about inflation, which means we’re going to see more of it in the months ahead. What is very interesting about these job additions is that it’s not having the impact on wage growth that one would see in a tight labor market. Wage growth still trails inflation, and last month average hours also declined slightly.

By the way, if you think this mystery will get resolved in the later revisions, don’t bet on it. See Heather Long’s tweet below. — Ed]

Another strong jobs report:

339,000 jobs added in May
3 month average = 283,000
April revised UP +41,000 to 294,000
March revised UP +52,000 to 217,000

Unemployment rate rose slightly to 3.7% as more people look for work and slightly fewer employed pic.twitter.com/aQHcg9osW4

— Heather Long (@byHeatherLong) June 2, 2023