The United States economy added 139,000 jobs during May while facing the effects of ongoing trade wars between President Trump and a slight decrease in hiring from April. The Labor Department announced job growth decreased to 139,000 in May from the revised 147,000 in April yet exceeded the predicted 130,000 jobs.
The unemployment rate maintained its position at 4.2% which is close to its historical minimum. The average hourly earnings increased 0.4% from April and reached 3.9% higher than last year’s numbers while surpassing market predictions.
The health care sector and leisure industry experienced the most significant job growth during the month as health providers added 62,000 positions and bars and restaurants employed 30,000 new staff members. The federal government cut 22,000 positions in May which marked the largest employment reduction since November 2020 due to Trump’s hiring freeze and budget reductions. The manufacturing sector lost 8,000 positions during the previous month.
The labor market demonstrates strength but shows initial signs of weakness because of growing economic uncertainty from trade tensions. The data has not yet shown full evidence of recession fears despite Trump’s unpredictable policies that include broad import tariffs which create economic uncertainty.
The labor market showed strong performance during its peak trade uncertainty period according to Seema Shah who leads global strategy at Principal Asset Management. The labor market shows signs of deterioration yet it remains intact rather than collapsing into complete disarray.
