Construction workers prepare steel for cranes at JPMorgan Chase’s new headquarters in New York City on May 18, 2023. Builders added jobs this month despite headwinds from rising interest rates. It was another sign of a strong job market in the country.
Spencer Pratt/Getty Images
hide caption
toggle caption
Spencer Pratt/Getty Images
Construction workers prepare steel for cranes at JPMorgan Chase’s new headquarters in New York City on May 18, 2023. Builders added jobs this month despite headwinds from rising interest rates. It was another sign of a strong job market in the country.
Spencer Pratt/Getty Images
It’s still a good time to look for work.
of latest employment report The country’s job market remains hot, adding 339,000 jobs in May, according to the Labor Department.
The figure was better than expected given the headwinds facing the economy, including rising interest rates. Analysts had expected about 190,000 jobs to be added.
In addition to last month’s big numbers, the already fairly strong employment gains in March and April were revised upwards, adding a total of 93,000 jobs.
Robust employment growth has a positive impact on the economy. But it could also complicate the Federal Reserve’s job in fighting inflation.
Here are five things you need to know about the country’s hot job market and what it means for the economy.
the benefits were remarkably widespread
Job gains last month were broad-based and show how strong the labor market was in May.
Health care, hospitality and business services each added tens of thousands of jobs. Construction companies have added 25,000 jobs, even as the housing market has been hit hard by the Fed’s sharp interest rate hikes.
The only industries to show job losses last month were manufacturing, which lost 2,000 jobs, and the “information” industry, which includes media and software companies, lost 7,000 jobs.
more people are joining the workforce
During the pandemic, one of the major concerns was how many people would leave the workplace for reasons such as childcare availability and health concerns. With the labor force shrinking, many employers are struggling to secure workers.
That’s changed in the last few months.
The percentage of adults working or looking for work remained unchanged last month, but more people of prime working age are leaving their side jobs.
The share of people aged 25 to 54 in the labor force rose to 83.4% last month, the highest level since 2007. In addition, the proportion of women working or looking for work in the same age group rose to 77.6%, the highest level. Since the government began keeping records of him in 1948.
The workforce is also benefiting from a rebound in immigration, which plummeted during the worst of the pandemic.
Percentage of foreign-born workers more than half grown Entered the workforce last year.
wages are rising
Not only are employers creating more jobs, they are generally increasing salaries.
Average wages in May rose 4.3% from the same month last year. Leah Koch-Bloomhardt, whose family runs the Holiday World and Splash Safari theme parks in Indiana, said wage increases have made it easier to hire seasonal workers this summer.
Koch-Bloomhardt said he pays young teenagers $13 an hour, the same as an 18-year-old theme park salary, up from $10 last year.
“So it’s a very competitive magnification for 16- and 17-year-olds in this field,” she says.
But rising wages could make fighting inflation even harder
Rising wages are good for workers, but they can also put upward pressure on prices, making it harder for the Fed to control inflation.
The Fed is hiking rates aggressively and policy makers should consider the latest jobs data to be collected again in mid-June.
For now, the gambling market expects the central bank to keep rates unchanged at its June meeting, after raising rates by 5 percentage points since March last year, the biggest since the early 1980s. .
And somehow the unemployment rate went up
The unemployment rate, compiled from a separate survey of households, casts a less rosy picture of the job market.
The unemployment rate rose to 3.7% in May after leveling at a half-century low of 3.4% in April. That’s still a very low number by historical standards, but the rise ties in with other data that suggests individuals aren’t as optimistic about the job market as they used to be.
Fewer workers are leaving their jobs, for example, indicating less confidence in finding better jobs elsewhere.
In another red flag, the African-American unemployment rate rose to 5.6% in May after falling to a record low of 4.7% last month.
