Employment grew by 139,000 jobs in May, the U.S. Bureau of Labor Statistics reported Friday, while the unemployment rate remained unchanged at 4.2%.
Employment continued to grow in the health care, leisure and hospitality, and social assistance sectors, but the federal government continued to lose jobs as the Trump administration kept up its efforts to slash the workforce. The professional and business services sector lost 18,000 jobs in May, but added 3,100 in accounting, tax preparation, bookkeeping and payroll services.
Average hourly earnings increased 15 cents, or 0.4%, to $36.24 in May. Over the past 12 months, average hourly earnings have grown 3.9%.
“Really only two sectors made up the bulk of all job growth — health care and social assistance (+78K) and leisure and hospitality (+48K),” said Andrew Flowers, chief economist at Appcast. “The ‘diffusion index’ (which measures the breadth of job growth) fell near the lowest point of this cycle. Beyond those sectors, there were signs that professional and business services job growth has weakened further, with the three-month moving average now negative. Moreover, the DOGE-led effort to trim government bureaucrats is having real effects, with a -22K job contraction in the federal workforce.”
As part of those cuts, the U.S. Bureau of Labor Statistics itself has been cutting back on its collection of consumer data for measures such as the Consumer Price Index, which could affect the reliability of some of its data. The BLS has also been getting lower response rates in recent years to its surveys, which could affect the reliability of its data. “They’re getting a lot less data than they used to, so those things add up to probably some volatility in the numbers that come out,” said Frank Fiorille, vice president of risk, compliance and data analytics at Paychex.
The BLS also revised the job numbers for March and April, with March’s total revised down by 65,000, from a gain of 185,000 jobs to 120,000, and the change for April revised down by 30,000, from 177,000 to 147,000 jobs gained. With both of those revisions, employment in March and April combined was 95,000 lower than previously reported.
The top Democrat on the House’s tax-writing committee pointed to the revisions. “The warning signs are here: revisions quietly wiped out 95,000 jobs from the past two months and participation in the labor force shrunk,” said House Ways and Means Committee ranking member Richard Neal, D-Massachusetts, in a statement. “The President is sowing cracks underneath the resilient economy he inherited — his irresponsible flip-flopping tariff agenda, his careless weaponization of government, and a White House filled with chaos undermines our economic strength with more seriousness each day.”
