Job growth surged beyond expectations in May, according to new data from the Bureau of Labor Statistics.
Concretely, nonfarm payrolls climbed 172,000 last month, more than twice the figure expected by the Dow Jones consensus. April's figure was revised upwards to 179,000.
The unemployment rate stood at 4.3%, in line with expectations. "Among the major worker groups, the unemployment rates showed little or no change in May for adult men (4.0 percent), adult women (3.8 percent), teenagers (14.7 percent), and people who are White (3.8 percent), Black (6.6 percent), Asian (3.8 percent), or Hispanic (5.0 percent)," the report noted.
Average hourly earnings climbed 0.3% compared to the previous month and 3.4% in an inter-annual basis, also in line with expectations. Inflation stood at 3.8% in April, largely as a result of energy-related spikes resulting from the war in Iran, meaning that wage growth is lagging price increases.
Leisure and hospitality led the increase with 70,000 roles, much higher than the 14,000 monthly average from the past year. Local government also added 55,000. Healthcare added 35,000 jobs and social assistance 12,000. Among the weaker sectors were financial services, which shed 22,000 jobs, and the transportation/warehousing industry.
Private payrolls also exceeded expectations last month, according to the latest ADP report. Concretely, companies added 122,000 workers, above the 110,000 expected by analysts. It was the strongest gain since January 2025.
CNBC noted that gains were more broad-based than in previous months, when they were concentrated in the healthcare sector.
"Hiring was more broad-based in May than we've seen in the last few years," said ADP chief economist Nela Richardson. "The labor market continues to show sustained momentum going into the summer hiring season."
Elsewhere, the report noted that companies with fewer than 50 employees hired 67,000 roles, while those with 500 or more added some 40,000. Middle-sized companies added the rest.
Another report showed that U.S. job openings rose to their highest level in nearly two years in April, a surprising sign of resilience in the labor market even as employers continued to show caution in the actual hiring of new employees.
The number of available jobs jumped by 731,000 to 7.618 million on the last day of April, the highest level since May 2024, according to the Labor Department's Job Openings and Labor Turnover Survey, known as JOLTS.
Economists surveyed by Reuters had expected 6.88 million openings, making the increase much stronger than the forecast consensus.
