Hospitality and healthcare lead stronger-than-expected U.S. job growth in May |
The U.S. labor market continued to show resilience in May, adding 172,000 jobs, well above economists’ expectations of 80,000, while the unemployment rate remained unchanged at 4.3%. The Labor Department report stated that leisure and hospitality led hiring with 70,000 new jobs, supported by seasonal demand and preparations for the upcoming World Cup. Healthcare and social assistance added 47,000 positions, while local government employment rose by 55,000 jobs. Construction also posted gains for a third consecutive month. Several sectors saw declines, however, including retail, finance, and information services. Air transportation employment fell by nearly 9,000 jobs, reflecting the impact of Spirit Airlines’ collapse. The report also included significant upward revisions to prior months, with March job growth revised to 214,000 and April revised to 179,000, indicating stronger labor market momentum than previously reported. The stronger hiring data has shifted attention at the Federal Reserve from potential interest rate cuts toward the possibility of future rate increases, particularly as inflation pressures persist. Treasury yields rose following the report as investors increased expectations that the Fed could tighten policy later this year.
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