May jobs report: 4 things to know

The U-6 has plunged since January to 8.6 percent in April, a 0.8 point decline. Moreover, some slowdown in hiring was probably inevitable as the unemployment rate falls and the pool of available workers begins to dry up. "If wage growth doesn't improve, the Fed is going to want to soften its stance on how many rate rises are to come this year and next".

Among the unemployed, the number of job losers and persons who completed temporary jobs declined by 211,000 to 3.3 million in May. That would still be at least twice as high as the number of new jobs the economy needs to just keep up with population growth - an indication that the USA labor market continues to tighten.

May marks the fourth straight month that the retail sector has shed jobs, highlighting the ongoing financial struggles of many brick-and-mortar stores amid the growth in ecommerce. Construction and mining payrolls also rose.

Employment in health care rose by 24,000 in May.

Elise Gould of the left-leaning Economic Policy Institute said a June rate increase by the Fed would be "unfortunate", adding that prematurely declaring full employment would be far more costly than tolerating some wage growth and price inflation.

May's job growth was down from 174,000 the previous month. In May, employment in professional and business services, which impacts the office market, continued to trend up (gaining 38,000).

The government's monthly jobs report produces a net gain by estimating how many jobs were created and comparing that figure with how many it estimates were lost. Employment in food services and drinking places also showed increases of 30,000.

Hiring in the months of April and March was revised downward by a combined 66,000. Over the past year, employers have added an average of 181,000 jobs per month.

Expectations for a bumper jobs report had mounted after ADP, the US's largest private payroll processor, announced employers had added 253,000 jobs in May - well above the 180,000 economists had been expecting.

The jobs report is a closely watched barometer of the United States economy and one of the metrics the U.S. central bank considers as it sets interest rates.

Looking behind the immediate numbers, the picture is mixed at best.

The Labor Department said Friday that the unemployment rate fell to 4.3%, from 4.4%, a 16-year low. That might sound like good news.

The historically low unemployment rate likely gives the Fed leeway to increase the central bank's benchmark interest rate this month.

U.S. financial markets are nearly pricing in a 25 basis point increase in the Fed's benchmark overnight interest rate at that meeting, according to CME FedWatch. Data on consumer spending and manufacturing suggest the economy gained speed early in the second quarter after gross domestic product increased at a tepid 1.2% annualized rate at the start of the year.

Analysts described the data as disappointing. For those who think the economy is close to capacity, last month's gains were solid.

For metropolitan areas in April, the agency says, Ames, Iowa, and Boulder, Colo., had the lowest unemployment rates, at 1.7 percent and 1.8 percent, respectively.

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