In May, the U.S. non-farm payrolls increased by 139,000, hitting a new low since February, with the data for the previous two months significantly revised down by 95,000, and the unemployment rate at 4.2%

In May, the non-farm payrolls in the United States increased by 139,000, slightly above the market expectation of 126,000. However, the employment data for the previous two months was revised down by a total of 95,000, a correction large enough to offset the apparent positive performance.

On June 6, data released by the U.S. Bureau of Labor Statistics showed:

• The U.S. non-farm employment population increased by 139,000 in May, expected 126,000. The March data was revised down from 185,000 to 120,000, and the April data was revised down from 177,000 to 147,000.
• The U.S. unemployment rate in May was 4.2%, expected 4.2%, previous value 4.2%.

More notably, the average hourly wage increased by 0.4% month-on-month, exceeding the expected 0.3%, indicating that wage inflation pressures remain. The labor force participation rate has decreased slightly.

Manufacturing Industry Signals Alarm, Federal Government Cuts Jobs Significantly

Industries more directly impacted by tariffs have begun to show warning signs—manufacturing jobs decreased by 8,000, marking the largest decline this year. Employment growth in transportation and warehousing was weak, following two consecutive months of decline.

The federal government laid off 22,000 workers in May, the highest record since 2020. This directly reflects the initial impact of the Trump administration's efforts to cut government spending. Economists warn that as federal spending cuts affect contractors, universities, and other institutions reliant on public funding, at least 500,000 U.S. jobs may be at risk.

In contrast, the service sector continues to show resilience, with healthcare, social assistance, and leisure and hospitality driving employment growth.

The non-farm data helped alleviate market concerns about rapid job cuts by companies. Previously, businesses had generally shown a cautious attitude in the face of higher costs due to tariffs and the prospect of slowing economic activity.

After the data was released, traders lowered their bets on two rate cuts by the Federal Reserve within the year.

"New Federal Reserve Correspondent" Nick Timiraos: Looking Closer, U.S. Unemployment Rate is Actually Rising

"New Federal Reserve Correspondent" Nick Timiraos stated that, based on unrounded data, the unemployment rate in May rose from 4.187% in April to 4.244%. The highest unemployment rate last year occurred in November 2024, at 4.231%.

It can be said that the U.S. unemployment rate in May is the highest level since October 2021 (when it was 4.500%) based on unrounded figures.

Market Reaction

The U.S. dollar index briefly rose by about 10 points, currently reported at 99.15.

U.S. stock futures briefly rose, with the Nasdaq 100 index futures up 0.8%. The yield on the U.S. 10-year Treasury bond briefly rose, currently reported at 4.407%

Spot gold has fallen about $5 in the short term, currently reported at $3351.75 per ounce.

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