The US economy added 139,000 jobs in May, a slowdown compared with recent months as American businesses cope with uncertainty around Donald Trump’s continuing trade war.
After signs of a strong labor market in April – which was largely seen as resiliency against teetering trade policy from the White House – May saw a drop in new jobs added to the labor market, according to new data from the Bureau of Labor Statistics. The unemployment rate remained steady at 4.2%, unchanged from last month.
May’s jobs report was dragged down by the loss of 22,000 federal workers’ jobs as the Trump administration used the so-called “department of government efficiency” (Doge) to cut government positions. Since January, 59,000 Federal jobs have been cut.
The Bureau of Labor Statistics also cut the numbers of jobs created in March and April. In an update, the bureau said a total of 95,000 fewer jobs had been created over the two months.
After the report was released, Trump once again called on the Federal Reserve chair, Jerome Powell (whom he has nicknamed “Too Late”), to cut interest rates.
“‘Too Late’ at the Fed is a disaster! Europe has had 10 rate cuts, we have had none. Despite him, our Country is doing great. Go for a full point, Rocket Fuel!” the president wrote on Truth Social.
Economists expected a downward slump after data earlier in the week suggested a cooling job market. Payroll firm ADP reported that private-sector payrolls increased by just 37,000 in May, the lowest gain in more than two years.
“After a strong start to the year, hiring is losing momentum,” said Nela Richardson, chief economist at ADP, in a statement.
The Institute for Supply Management also released its latest purchasing mangers’ index figure, which measures the general landscape for manufacturers and showed a reading of 49.9 in April – the lowest since June 2024.
In the most recent results of the University of Michigan’s survey of consumers, released at the end of May, consumer sentiment had stayed relatively stable from April to May, with the caveat that April’s reading was the lowest drop in consumer sentiment since 1990.
The impact of Trump’s trade war has yet to be seen in inflation readings. In April, the annual inflation rate was at 2.3%, a slight decrease from March, though economists said that the impact of Trump’s tariffs will be gradual and likely will not impact data until the summer.
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