U.S. Economy Surpassed Expectations, Added 272,000 Jobs In May

By iHeartRadio

June 7, 2024

Interviewer shaking hands with candidate sitting at desk in office
Photo: Westend61 / Westend61 / Getty Images

The U.S. economy added a robust 272,000 jobs in May, surpassing economists' expectations and indicating continued confidence among employers despite high interest rates. The data, released by the Bureau of Labor Statistics, shows a significant increase from the 165,000 jobs added in April. However, the unemployment rate rose slightly to 4% from 3.9% in April, ending a 27-month streak of unemployment below 4%.

The job gains were widespread across various sectors. The healthcare sector added 68,000 jobs, while government employment increased by 43,000 jobs. The leisure and hospitality sector also saw an increase, adding 42,000 jobs.

Despite the strong job growth, there were some signs of a potential economic slowdown. The labor force participation rate slipped to 62.5% from 62.7% the previous month. However, participation among prime-age workers, ages 25-54, rose to its highest level in 22 years.

Wage growth also accelerated last month, with wages rising 4.1% from a year ago, above the inflation rate. This could potentially contribute to persistent inflation, as some companies may raise their prices to offset higher wage costs.

The Federal Reserve is closely monitoring these developments as it considers when to begin cutting its benchmark interest rate. Most economists expect no Fed rate reductions before September at the earliest.

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