DOMESTIC JOB GROWTH rebounded last month after a lackluster April, as the unemployment rate ticked down to its lowest level in more than 18 years, according to a report published Friday by the Bureau of Labor Statistics. At 3.8 percent, the national unemployment rate is now as low as it’s been since April 2000. The last time unemployment was lower than it is now was at the tail end of 1969, when the rate sat at 3.5 percent.
Domestic employers, meanwhile, created 223,000 new positions – the strongest showing the labor market has seen since February. The number of health care and social assistance jobs in the U.S. climbed by nearly 32,000, while retail trade outfits added more than 31,000 new positions. Revisions to prior months’ tallies added 15,000 previously unreported jobs to the labor market, and Americans’ average hourly earnings ended May up 2.7 percent over the year.
Although the labor force participation rate – a metric that tracks the share of Americans employed or actively looking for a job as a share of the broader population – ticked down for the second consecutive month to 62.7 percent, the bulk of the report detailed a labor market standing on particularly solid ground.
Here’s what some of the nation’s leading economists are saying about May’s jobs report:
Steve Rick, chief economist at CUNA Mutual Group
“The employment this month really underscores, once again, the robust strength of the labor market. May showed steady momentum in jobs and certainly hit back at any worries among economists who thought hiring was beginning to finally slow after seeing last month’s report.”
Jim Baird, partner and chief investment officer at Plante Moran Financial Advisors
“Assuming that job creation continues and the jobless rate dips further, how low is unemployment then from a historical perspective? Very low … half-century low. The unemployment rate hasn’t been below 3.8% since December 1969. And neither the economy broadly nor job creation specifically show signs of letting up, so there appears to be more room for joblessness to continue to decline from here.”
Martha Gimbel, director of economic research at Indeed
“While the May jobs report is almost entirely positive, there are a few downsides. Both the prime-age employment-population ratio and the rate of workers working part-time for economic reasons have continued to hold around their level of the last few months. … Overall, this report is consistent with where we’ve been for awhile: strong job growth, low unemployment rate, but with workers still waiting for wage growth to take off.”
Mark Hamrick, senior economic analyst at Bankrate
“The May employment report falls within a virtual sweet spot as these reports go. … [But] potential headwinds include U.S. shots fired in [a potential] trade war. President Trump has generated near-universal criticism of his decision to impose tariffs, or taxes, on steel and aluminum imports from Canada, Mexico and Europe. Consumers and businesses in the U.S. will be among those feeling the brunt of these impacts. … The ultimate impact could be to hinder future job growth.”
Gus Faucher, senior vice president and chief economist at PNC Financial Services Group
“With the excellent jobs report, including the solid gain in wages, the Federal Open Market Committee will raise the federal funds rate when they meet on June 13. The FOMC wants to take some of the pressure off of the labor market to avoid overheating in the economy that would push inflation too far above the Fed’s 2 percent inflation goal.”
Elise Gould, senior economist at the Economic Policy Institute
“In a full employment economy, we would see wages rising much faster—closer to 3.5 percent and above—to claw back the losses to labor share in the aftermath of the Great Recession. While economists and commentators have myriad explanations for why wage growth is so sluggish, it seems obvious that, with many workers still unemployed or sitting on the sidelines, employers just don’t have any incentive to raise wages.”
By Andrew Soergel, Senior Reporter, USnews.