The U.S. economy added 272,000 jobs in May, a stronger-than-expected increase that suggests continued resilience in the labor market. The unemployment rate ticked up slightly to 4.0% from 3.9% in April.
The Labor Department’s report on Friday also showed upward revisions to job gains in the prior two months. Average hourly earnings rose 0.4% in May, indicating persistent wage pressures.
The figures come as the Federal Reserve weighs its next move on interest rates. While the robust job growth might temper expectations for imminent rate cuts, the slight rise in unemployment could offer some reassurance.
Economists surveyed by Reuters had forecast 185,000 job additions and an unemployment rate of 3.9%. The stronger-than-expected report paints a picture of an economy that continues to expand, albeit with some signs of cooling.
Sectors that saw significant job gains included healthcare, government, and leisure and hospitality. Manufacturing and construction jobs also saw modest increases.
The report will be closely watched by policymakers and investors as they assess the health of the U.S. economy and the path forward for monetary policy.