BOOM: Jobs Market Adds 172,000 Jobs in May, +93K in Revisions

Donald Trump finally got the economic success he has touted since his re-election. Will it come in time to boost the GOP’s midterm chances?

For the third straight month, the US job market blew past analyst expectations. The economy added 172,000 jobs in May, according to today’s jobs report from the Bureau of Labor Statistics. Not only that, but revisions to the previous two months added another 93,000 jobs. Wages also kept pace slightly ahead of inflation, despite the worries over the oil crunch creating a mildly worrisome inflationary wave:

Total nonfarm payroll employment increased by 172,000 in May, and the unemployment rate was unchanged at 4.3 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in leisure and hospitality, local government, and health care. Employment in financial activities declined. … 

In May, average hourly earnings for all employees on private nonfarm payrolls rose by 12 cents, or 0.3 percent, to $37.53. Over the year, average hourly earnings have increased by 3.4 percent. In May, average hourly earnings of private-sector production and nonsupervisory employees rose by 8 cents, or 0.2 percent, to $32.31. (See tables B-3 and B-8.)

The average workweek for all employees on private nonfarm payrolls was unchanged at 34.3 hours in May. In manufacturing, the average workweek was unchanged at 40.4 hours, and overtime edged up to 3.1 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls remained at 33.8 hours. (See tables B-2 and B-7.)

The change in total nonfarm payroll employment for March was revised up by 29,000, from +185,000 to +214,000, and the change for April was revised up by 64,000, from +115,000 to +179,000. With these revisions, employment in March and April combined is 93,000 higher than previously reported. (Monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors.)

Whatever troubles the labor market had last year seem to have dissipated in 2026. The general impression, especially given the consistent strength in wage growth, is that the harsh enforcement of immigration law forced the jobs market into a transition that may have overstated a jobs stall. Foreign workers got replaced with legitimate labor, along with employers dealing with the uncertainty around tariffs. This appears to be the strongest three-month period in three years, and if it hadn’t been for a sharp correction in January, we would have five straight months of growth well above replacement and/or population-growth levels. 

The Wall Street Journal noted that analyst expectations predicted May’s gains at less than half of that reported by the BLS, and recognized that a corner had been turned:

The U.S. labor market has climbed out of a rut.

The country added more jobs than expected in May, posting strong payroll gains for the third month in a row. It was the latest sign that the U.S. labor market is steadily recovering from a weak patch last fall and winter.

The U.S. added 172,000 jobs in May, the Labor Department said Friday, beating expectations. That was far better than the 80,000 jobs that analysts polled by The Wall Street Journal had expected to see.

CNBC speculated that the “low hire low fire” economic environment may be gone for good:

The report came against a background of muted expectations as employers have held their ground in a low-hire, low-fire environment. While job gains have been largely concentrated in just a few sectors, layoffs also have been moderate, though some signs are building that artificial intelligence is having an impact on labor rolls.

Breadth of job gains improved in May, with multiple sectors seeing solid advances.

Leisure and hospitality led all sectors with 70,000 jobs, well above the 14,000 per month average over the past year. Local government added 55,000.

Health care, which has been the leading sector, contributed 35,000 new hires, about in line with its average. Social assistance added 12,000.

The goods-producing sector had decent growth numbers as well, adding 28,000 jobs in May. The big winners there were construction and durable goods, both of which added 17,000 jobs, while non-durable goods lost 10,000. Interestingly, the government sector added 52,000 jobs, all of which came at the local level. The federal government added a thousand jobs, thanks to the addition of 2900 at the US Postal Service and a decline of 2600 everywhere else. State government jobs declined by 4,000, but local governments added 55,000. 

This looks like a broad-based advance in the US jobs market, even more impressive in the face of rising inflation. The downside to that is that the Federal Reserve will feel more comfortable focusing on inflation containment rather than jobs investment in the near term. Expect to see some pressure to raise the prime interest rate at some point, unless the situation in Iran settles quickly and oil markets return to normal. 

Rick Santelli and the CNBC crew discussed this after the report release, but Santelli is bullish on the economy now with these numbers. The big question is whether voters will be as enthusiastic. 

Editor’s Note: Thanks to President Trump’s leadership and bold policies, America’s economy is back on track.

Help us continue to report on the president’s economic successes and combat the lies of the Democrats. Join HotAir VIP and use promo code FIGHT to receive 60% off your membership.