Job growth reaccelerated in May with employers adding 339,000 jobs, primarily in six industries, but the unemployment rate increased from 3.4% to 3.7%, its highest since October 2022.
The African American unemployment rate jumped to 5.6%, but monthly numbers can jump around in the BLS household survey and the record low last month may have been a statistical fluke.
Gains in just six industries: Professional and Business Services (+64,000), Health Care (+52,400), State and Local Government (+49,000), Leisure and Hospitality (+48,000), Private Education Services (+22,300), and Social Assistance (+22,200) all saw job growth. There was very little job growth in all other major industry groups.
Pay gains slow a bit further. Average hourly earnings were up 4.3% in May from a year ago, but down from the 5.9% wage gain we saw in March 2022.
Job openings rose, but only in four industries: Construction, Retail Trade, Transportation and Warehousing, and Health Care/Social Assistance.
Outlook: The job market has enough momentum to sustain consumer spending and the economy into the fall. Travel and vacation-related hiring appears to be reaccelerating going into the summer and immigration appears to be impacting the job gains in the Social Assistance industry and State and Local Government.
