US economy added 139,000 jobs in May
Newsflash: Hiring slowed across the US economy last month, and fewer jobs were created than previously thought in March and April too.
The US added 139,000 new jobs in May, according to the latest non-farm payroll report, with the US unemployment rate unchanged at 4.2%.
Economists had expected the non-farm payroll to rise by 130,000 jobs, so this is slightly higher than forecast.
The U.S. Bureau of Labor Statistics reports that “employment continued to trend up in health care, leisure and hospitality, and social assistance. Federal government continued to lose jobs.”
But, the report also reveals that 95,000 fewer jobs were created in March and April than previously estimated.
The change in total nonfarm payroll employment for March was revised down by 65,000, from +185,000 to +120,000, and the change for April was revised down by 30,000, from +177,000 to +147,000, the BLS says.
Key events
Investor: US jobs market is in limbo
Byron Anderson, head of fixed income at Laffer Tengler Investments, warns that uncertainty is holding back the US jobs market:
“With the amount of uncertainty in the economy, it is not surprising that hiring is slowing. If there is a bright spot, it is that the unemployment rate didn’t increase. The US isn’t hiring, but they aren’t firing either, which will only last so long if we do not see a resolution to the larger issues.
Limbo is not a great spot for business and job creation. Who would feel comfortable with the Truther in Chief that can flip the economy on its head with one ill-advised tweet.”
Stephen Brown, deputy chief North America economist at Capital Economics, has spotted signs that the Trump trade war hit the jobs market last month:
The contributions to the 139,000 rise in payrolls in May were unusually narrow, with 78,000 of the gain from health care & social assistance and another 48,000 from leisure & hospitality.
Elsewhere, the 8,000 drop in manufacturing and 6,500 decline in retail point to some limited negative tariff effects. That said, it was striking that transportation & warehousing employment rebounded by 5,800, despite reports of sharp declines in job openings amid lower imports.
Wealth Club: US jobs market shrugs off tariffs
Today’s jobs report shows the US labor market has shrugged off the tariff uncertainty that rocked global stock and bond markets in April and May, reports Nicholas Hyett, investment manager at Wealth Club:
While the Federal government has continued to shed a small number of jobs, the wider economy has more than made up the difference, with the US adding slightly more jobs than expected in May. Wage growth also came in higher than expected – suggesting the economy is in rude health.
That will be taken as vindication by the Trump administration – which has been clear that the tariffs are aimed squarely at supporting Main Street rather than pleasing Wall Street. Less positive from the White Houses’ point of view is that a strong economy and rising wages gives the Federal Reserve less reason to cut interest rates – pushing yields a touch higher and making the fiscal splurge built into Trump’s “Big Beautiful Bill” that bit more expensive.
With rate cuts looking less likely, Fed Chair Jay Powell can expect to remain firmly in the President’s firing line once the spat with Musk is over.”
[of course, had Trump not u-turned on his initial plans for higher tariffs, today’s jobs data might be worse….]
US annual hourly earnings up 3.9%
Earnings grew faster than expected across the US economy last month – a boost to workers, but a potential worry for central bankers.
Average hourly earnings for all employees on private nonfarm payrolls rose by 15 cents, or 0.4%, to $36.24 in May, today’s jobs report shows. Economists had forecast a smaller rise, of 0.3%.
Over the past 12 months, average hourly earnings have increased by 3.9%, ahead of forecasts of a 3.7% rise.
April’s annual wage growth data has been revised up too, from 3.8% to 3.9%.
Higher wages can lead to stickier inflation, which may deter the Federal Reserve from cutting US interest rates despite mounting pressure from Donald Trump.
The 139,000 increase in the US non-farm payroll last month is slightly below the average monthly gain of 149,000 recorded over the prior 12 months.
Digging into the US jobs report, we can see that the labor force participation rate decreased by 0.2 percentage point to 62.4% in May.
That suggests a small increase in people neither in work nor looking for a job.
Where jobs were added, or lost
The US healthcare sector added 62,000 jobs in May, higher than the average monthly gain of 44,000 over the prior 12 months, according to today’s jobs report. Job gains occurred in hospitals (+30,000), ambulatory health care services (+29,000), and skilled nursing care facilities (+6,000).
Employment in leisure and hospitality continued to trend up in May (+48,000), largely in food services and drinking places (+30,000).
In May, social assistance employment continued to trend up (+16,000), reflecting continued growth in individual and family services (+16,000).
Federal government employment continued to decline in May (-22,000) and is down by 59,000 since January. (Employees on paid leave or receiving ongoing severance pay are counted as employed in the establishment survey, so this may not capture the full impact of Elon Musk’s DOGE cost-cutting drive)
US economy added 139,000 jobs in May
Newsflash: Hiring slowed across the US economy last month, and fewer jobs were created than previously thought in March and April too.
The US added 139,000 new jobs in May, according to the latest non-farm payroll report, with the US unemployment rate unchanged at 4.2%.
Economists had expected the non-farm payroll to rise by 130,000 jobs, so this is slightly higher than forecast.
The U.S. Bureau of Labor Statistics reports that “employment continued to trend up in health care, leisure and hospitality, and social assistance. Federal government continued to lose jobs.”
But, the report also reveals that 95,000 fewer jobs were created in March and April than previously estimated.
The change in total nonfarm payroll employment for March was revised down by 65,000, from +185,000 to +120,000, and the change for April was revised down by 30,000, from +177,000 to +147,000, the BLS says.
US jobs report approaches….
Tension is building in the financial markets as investors await the latest US jobs report, due in under half an hour’s time.
As flagged in the introduction, economists expect a hiring slowdown – with non-farm payrolls forecast to increase by around 130,000 for last month, down from 177k in April.
But as usual, there’s a wide range of forecasts – from a low of 75,000 new jobs to a high of 190k.
US May Payrolls Seen Slowing Sharply, Keeping Fed on Cautious Path
Friday’s US non-farm payrolls (NFP) report will conclude a volatile week, during which US President Donald Trump’s import tariffs dominated headlines and drove moves in global equity markets.
Economists expect… pic.twitter.com/6o9VTq0g1r
— LiveSquawk (@LiveSquawk) June 6, 2025
The unemployment rate is expected to remain steady at 4.2%.
Kathleen Brooks, research director at XTB, explains:
The US economy needs to create approximately 200k jobs per month for the unemployment rate to remain stable, likewise, initial jobless claims need to stay below 260k-270k per week for the unemployment rate not to rise. The question is, will job growth slow to such an extent that the unemployment rate rises? The consensus is no, not yet. It is worth considering the economic backdrop, to determine if a downside surprise in the labour market data could materialise on Friday. Consumer sentiment has picked up in recent weeks, although it remains at low levels, business confidence has also picked up from the lows, and the layoff rate, as calculated by the Jolts survey, remains stable.
Thus, while we expect a soft May payrolls report, we do not think that it will show the labour market falling off a cliff. The de-escalation in the US/ China trade war may have helped sentiment. There remains a huge amount of uncertainty caused by the US trade tariffs, and if the US economy can generate decent jobs growth in this environment it would suggest an underlying resilience, which could boost stock markets, the dollar and overall risk sentiment.
Anything under 100k for May payrolls would be considered weak, and it may also be a sign of worse to come. Thus, Friday’s report is all about the trajectory of the US labour market and what this means for the Federal Reserve.
NatWest banking app is down
UK bank NatWest has apologised to customers after service issues left people unable to log in to their mobile app.
Customers are being urged to use online or telephone banking, or go into a branch, while it works to fix the problem.
A spokeswoman for the bank said:
“We are aware that customers are experiencing difficulties accessing the NatWest mobile banking app this morning.
“We’re really sorry about this and working to fix it as quickly as possible.
“Customers can still use online and telephone banking, or visit a branch.”
More than 3,000 outages were reported through services monitoring site Downdetector at about 10am on Friday.
UK proposes lifting ban on bitcoin and crypto funds
Britain’s financial regulator is clearing the way for UK investors to buy crypto assets such as bitcoin though low-cost ETF-style funds.
The Financial Conduct Authority is proposing to lift the ban on offering crypto exchange traded notes (cETNs) to retail investors.
The change would mean that cETNs could be sold to individual consumers, rather than just professional investors, in the UK, if they’re traded on an FCA-approved investment exchange.
The FCA notes that similar products are already available in other countries.
David Geale, executive director of payments and digital assets at the FCA said:
“This consultation demonstrates our commitment to supporting the growth and competitiveness of the UK’s crypto industry. We want to rebalance our approach to risk and lifting the ban would allow people to make the choice on whether such a high-risk investment is right for them given they could lose all their money.”
This feels like a change of position from the regulator, which has previously warned that crypto investors should be prepared to lose all their money
The UK boss of Tata Steet is urging the British government to secure its trade deal with Donald Trump as soon as possible, amid fears it could miss out on tariff-free access to the US.
It was reported yesterday that Tata Steel, which runs the vast Port Talbot steelworks in south Wales, could breach US import rules that require all steel to be “melted and poured” in the country from which it is imported.
That’s because Tata is curently importing steel from its sister companies in India and Europe to be finished in the UK, having shut down its blast furnace at Port Talbot last year as it shifts to a greener electric arc furnace.
Rajesh Nair, CEO of Tata Steel UK says today:
“We are grateful for the work the UK Government has undertaken so far in negotiating this trade agreement with the US administration.
“Tata Steel UK will need to import steel substrate until Electric Arc Furnace steelmaking is operational in Port Talbot from late 2027 onwards. It is therefore critical for our business that melted and poured in the UK is not a requirement to access the steel quotas in any future trade deal.
“Even though we are not currently melting steel in the UK, we remain the largest steel producer in the country and our mills continue to transform imported steel coil and slab into high-value, specialist products which are not available from US producers and are therefore essential to our US customers.
“We urge the government to secure a deal as soon as possible, and we would be happy to provide the US Government with any needed assurances on the provenance and processing of the steel we supply.
“However, a good deal with the US will not negate the need for an urgent review of the UK’s own tariff rate quotas for steel to protect us from re-diverted steel flows and global overcapacity”.
Silver price hits 13-year high
The price of silver has hit a 13-year high this morning.
Silver traded as high as $36.29 per ounce, its highest level since February 2012.
Achilleas Georgolopoulos, senior market analyst at Trading Point, suggests anxiety over the US-China dispute over rare earth minerals could be lifting the silver price:
Silver is stealing the limelight, as, at the time of writing, it is trading above the $36 level, recording a new 13-year high.
Some investors believe that this move could be an indication of a brighter economic outlook, given silver’s multiple industrial uses. While that could be the case, the current upleg could also be driven by hoarding amidst the ongoing rare earth metals dispute.
As well as being a precious metal, silver also has industrial uses, in electronics, automobile components and solar panels.
Another factor may be some investors shifting out of gold into silver, which has hit a series of record highs in the last few years.
Alexander Zumpfe, a senior trader at German gold refiner Heraeus Group, told Bloomberg yesterday that there was “renewed interest from momentum-driven investors who are rotating into silver.”
Zumpfe explained:
“After lagging behind gold for several weeks, silver is now catching up,”
The weakness of the dollar has also pushed up the prices of precious metals quoted in the US currency.
Eurozone growth revised up to 0.6% in Q1 2025
Newsflash: the eurozone economy grew faster than previously estimated.
Eurozone GDP rose by 0.6% in January-March, new data from eurostat shows, twice as fast as the 0.3% growth previously estimated.
The increase has been driven by Ireland, whose economy expanded by a sizzling 9.7% in the last quarter, due to a surge of exports of products, such as pharmaceuticals, to avoid new US tariffs.
Ireland was followed by Malta (+2.1%) and Cyprus (+1.3%). The highest decreases were observed in Luxembourg (-1.0%), Slovenia (-0.8%), Denmark and Portugal (both -0.5%).
Germany expanded by 0.4%, and France by 0.1%, slower than the UK which expanded by 0.7% in the quarter.
The owner of Pret A Manger is reportedly considering selling a stake in the sandwich chain ahead of a potential stock market flotation.
Luxembourg-based JAB Holding – which bought Pret for £1.5 billion in 2018 – told the Financial Times that while it was not “currently” considering a stake sale in Pret, it could look at the move with an initial public offering (IPO) in its sights.
“As we move closer to a potential IPO, we may evaluate bringing on a pre-IPO investor,” it told the FT.
It is thought to mark the first time Pret has publicly confirmed IPO plans for Pret, PA Media reports.
