Nonfarm payroll employment rose by 339,000 jobs in May, more than the consensus estimates, the Bureau of Labor Statistics reported Friday.
The unemployment rate rose to 3.7% in May, the highest rate since last October. It has remained at or below 3.7% since the end of the first quarter of 2022.
The leisure and hospitality sector added 48,000 jobs in May, 33,000 of which were at food services and drinking places. The industry has averaged 77,000 monthly job gains over the last 12 months and is now short of its February 2020 pre-pandemic employment level by 349,000 jobs.
The construction industry added 25,000 jobs in May and has added an average of 17,000 jobs per month over the past 12 months.
The biggest job gains in May were in professional and business services, government and healthcare. Other industries relevant to commercial real estate, including manufacturing and retail trade, saw little change in May employment numbers.
Here's how economists and others reacted to the May jobs report on Twitter:
339k jobs! Wow
— Adam Ozimek (@ModeledBehavior) June 2, 2023
Holy moly, jobs growth comes in hot again.
— Justin Wolfers (@JustinWolfers) June 2, 2023
Payrolls +339k
Unemployment rate up a tick to 3.7% suggesting a weaker household survey
Revisions are big: +52k for March, +41k for April.
Don't believe the doom-and-gloom talk.
This economy is motoring along.
Another gangbusters payrolls report. Total nonfarm payroll employment increased by 339,000 in May; forecast had been for ~190,000.
— Catherine Rampell (@crampell) June 2, 2023
In 13 of the past 14 months, the jobs number has exceeded forecasts.
If this isn't consistent with a soft landing, I don't know what is.
— Justin Bloesch (@JustinBloesch) June 2, 2023
This seems like a tough jobs report to interpret for the Fed.
— Jeanna Smialek (@jeannasmialek) June 2, 2023
*Employers added 339K jobs, vs. 195K expected
*Unemployment at 3.7%, vs. 3.4% previously
*Avg hourly earnings up 4.3% from prior year, vs. 4.4%
Today's jobs report should not materially increase the odds of a Fed hike in June given the short-run reaction function they have articulated with its presumption of a skip.
— Jason Furman (@jasonfurman) June 2, 2023
But it should raise the odds of a July hike.
And makes it even harder to see a cut later this year.
Goldman's Hatzius -- already below consensus on recession odds (35% over the next 12 months) -- says on @CNBC the risk is that number "goes lower," with:
— Carl Quintanilla (@carlquintanilla) June 2, 2023
1. a strong jobs number
2. debt ceiling deal
3. Fed likely on hold in June@SquawkStreet
This job report shows a slowing labor market, a continued expanding labor force, slowing wage growth, and the industries that are leading job growth are the ones that have been slowest to heal from the pandemic.
— Betsey Stevenson (@BetseyStevenson) June 2, 2023
US added 339,000 jobs in May across many sectors.
— Heather Long (@byHeatherLong) June 2, 2023
Biz +64,000
Gov't +56,000
Healthcare +52,000
Hospitality +48,000
Construction +25,000
Transport/Warehouse +24,000
Social assist +22,000
Retail +12,000
Finance +10,000
Real estate +3,000
Manufacturing -2,000
Info/media -9,000
residential construction adds 2.5k jobs, construction overall adds 25k
— Dean Baker (@DeanBaker13) June 2, 2023
The May jobs report is hard to reconcile. The 339k gain in payroll jobs suggests a strong labor market. But the 310k decline in household jobs and jump in unemployment suggest an easing market. As does the decline in hours. Feels like a resilient but moderating job market to me.
— Mark Zandi (@Markzandi) June 2, 2023
Since Feb '23, self-employment unincorporated is down 607k. So we're seeing a lot of return to payrolls from self-employment. Now thats a small sample, so caveat emptor, but if so that is less aggregate labor impact than the payrolls would otherwise suggest.
— Adam Ozimek (@ModeledBehavior) June 2, 2023
*339k, wow!*
— Conor Sen (@conorsen) June 2, 2023
*whoa that’s a weird household survey, hmm*
*oh, it’s noise from a decline in self-employment, okay that’s solid*
Drop in self-employed is a good reminder that labor market is still unwinding from COVID craziness. Number of people became self-employed soared as being employed had problems and opportunities abounded.
— Wendy Edelberg (@WendyEdelberg) June 2, 2023
PS. Wonder if this means business formation is coming back to earth.
Mixed signals in today's #jobsreport. Feels like there's something for everybody to point to to fit their narrative. Ironically, I read the report & end up feeling the same about the job market as before.
— Daniel Zhao (@DanielBZhao) June 2, 2023
Still hot-but-not-too-hot. Still slowing. Still some clear risks.
9/9
I'm not promising you there won't be a recession in 2023, but I can read a calendar, and we're running out of time.
— Justin Wolfers (@JustinWolfers) June 2, 2023
Whew, quite the jobs day today. Everyone take five and grab a cup of coffee.
— Adam Ozimek (@ModeledBehavior) June 2, 2023
