Jun 2, 2023 - Economy

U.S. economy adds 339,000 jobs as labor market stays hot

Photo: Micah Green/Bloomberg via Getty Images

The U.S. economy added 339,000 jobs in May, while the unemployment rate jumped to 3.7% from 3.4%, the Labor Department said Friday.

Why it matters: Job gains came in well above forecasters' expectations — the latest sign that the economy is still underpinned by a hot labor market.

  • Economists expected a gain of 190,000 jobs last month. The May jobs figures are a pickup from the 294,000 added in April, which was revised up by 41,000. Job gains in March were revised up, too.

Details: Economic policymakers have kept a close eye on other details from the payrolls report — whether more Americans are joining the workforce and how quickly pay is rising.

  • The labor force participation rate — the share of workers with a job or hunting for one — held at 62.6% in May.
  • Meanwhile, average hourly earnings, a measure of pay, rose by 0.3% in May. Compared to the same period a year ago, wages are up 4.3%.

What we're watching: The May jobs report is among the final data points Federal Reserve officials will consider before deciding whether to continue the interest rate hiking campaign that began more than a year ago.

  • Inflation remains too high, and there are concerns that rapid price gains are being fueled by the tight labor market and strong consumer demand.
  • Still, a top Fed official this week signaled the central bank may skip a rate hike at its meeting later this month.

Editor's note: This is a developing story. Please check back for updates.

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