Labor Market Still Overheating: U.S. Economy Added 339,000 Jobs in May, Smashing Expectations
The U.S. economy added 339,000 jobs in May and the unemployment rate rose to 3.7 percent, the Labor Department said Friday.
Economists had forecast employers would grow payrolls by 190,000, a downturn from the preliminary April estimate of 253,000. The unemployment rate was expected to pick up to 3.5 percent from 3.4 percent.
The labor market has been stronger than expected for several months, defying expectations that interest rate increases would push unemployment up. The Federal Reserve has been trying to cool off demand for workers as part of its efforts to bring inflation back down to its two percent target.
On Wednesday, the Labor Department said the number of job openings at the end of April rose to 10.1 million, crossing the ten million threshold for the first time since January. The ratio of vacancies to unemployed people rose to 1.8 to one, a sign of a significantly unbalanced labor market.
Initial jobless claims for the week that ended last Wednesday came in at 232,000. These are a proxy for layoffs and have been moving sideways for several weeks, suggesting employers are hanging on to workers despite some signs of economic sluggishness.
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