The US jobs report came in way hotter than expected

The US jobs report came in way hotter than expected

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  • US job growth in May was way stronger than the forecast.
  • Nonfarm payrolls increased by 272,000.
  • The US unemployment rate is no longer below 4%.

The May jobs report came in way hotter than expected, with the US adding 272,000 jobs while the unemployment rate slightly ticked up to 4.0%.

The job growth forecast per was 182,000. April’s increase was revised from 175,000 to 165,000. March’s increase was revised from 315,000 to 310,000, as noted in the news release from the Bureau of Labor Statistics on Friday.

The US unemployment rate was expected to be 3.9%, which would have meant the rate in May would have been the same as it was in April.

The jobs report published on Friday comes before the next Federal Open Market Committee meeting. It's expected the target rate will be unchanged, as seen by the CME FedWatch Tool.

"Over the past year, as labor market tightness has eased and inflation has declined, the risks to achieving our employment and inflation goals have moved toward better balance," Fed Chair Jerome Powell said at a FOMC press conference in May. "The economic outlook is uncertain, however, and we remain highly attentive to inflation risks."

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While US inflation has continued to be elevated, it's not as hot as it once was. The consistently low unemployment rate is one of several economic indicators that the US is avoiding a recession. Additionally, some recent data points to a soft landing.

"For many Americans, the difference between a soft landing and a more turbulent slowdown is their job," Nick Bunker, the economic research director for North America at the Indeed Hiring Lab, told Business Insider earlier this week.

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