US Payrolls Rose 339,000 in May, Beating Expectations

This week, the Labor Department confirmed that the U.S. economy continued its robust job creation in May, surpassing expectations despite facing various challenges. Both public and private-sector payrolls experienced a significant surge of 339,000, outperforming the estimated 190,000 new jobs projected by Dow Jones. This marks the 29th consecutive month of positive job growth

In May, the unemployment rate rose to 3.7%, slightly higher than the expected 3.5%. However, the labor force participation rate remained unchanged. Although the jobless rate was the highest since October 2022, it still remained close to the lowest it has been since 1969.

Average hourly earnings, a crucial indicator of inflation, increased by 0.3% for the month, aligning with expectations. On an annual basis, wages grew by 4.3%, slightly lower than the estimated rate by 0.1 percentage point. Additionally, the average work week decreased by 0.1 hour to 34.3 hours.

The market responded positively to the report, with Dow Jones Industrial Average-linked futures rising by approximately 200 points. Treasury yields also experienced an increase.

May's substantial increase in employment falls in line with the 12-month average of 341,000, demonstrating the resilience of the job market within an economy that has been gradually slowing. This positive data arrives during a challenging period for the economy, with some experts still anticipating a recession later in the year or in early 2024.