America’s labour market delivered an unexpected jolt of energy in May, adding 172,000 non-farm jobs and comfortably beating economists’ forecasts, according to US media reports on Friday, while the unemployment rate held steady at a predicted 4.3% – a sign of continued, stable expansion.
Employment growth was spread across multiple sectors of the economy. Leisure and hospitality led the way, gaining 70,000 positions, while local government authorities hired 55,000 people and the healthcare sector took on 35,000 new staff. Average hourly earnings rose by 0.3% month-on-month and by 3.4% compared with a year earlier.
Ellen Zentner, chief economic strategist at Morgan Stanley Wealth Management, noted that “stronger employment data leaves the Federal Reserve in a holding pattern – in monitoring and waiting mode, with its focus firmly on the inflation side of its mandate.”
May’s robust figures were further bolstered by upward revisions to data from the previous two months: April’s jobs total was raised by 64,000 and March’s by 29,000. Against a backdrop of resilient economic growth – with GDP expanding by 1.6% in the first quarter and a projected 3% rise in the second – the latest labour market statistics are likely to dissuade the Federal Reserve from cutting interest rates in the near term.
