Employers added 339,000 jobs in May, strong growth that defied head winds

Employers posted a blockbuster 339,000 jobs in May, the latest sign that a booming labor market continues to prevent the country from slipping into a recession.

However, new warning signs also appeared in the economy, as the unemployment rate shot up in May to 3.7% from 3.4%, one of the fastest surges since early in the pandemic, according to the Bureau of Labor Statistics data released Friday.

Some 440,000 workers reported that they are unemployed – and most of those were due to temporary jobs ending or layoffs, according to the data.

In particular, Black unemployment, which had reached a record low in April, increased by nearly an entire percentage point to 5.6% in May.

Overall, the May jobs report was good news, reflecting the 29th straight month of strong job growth that has come to define the pandemic recovery economy.

Economists had predicted a much smaller number of jobs created, around 180,000.

For months, employers have churned out jobs at a rate that has baffled economists.

And the labor market has propelled the economy through a barrage of forces that would normally weigh on jobs creation – steep interest rate hikes, bank failures and several rounds of layoffs in tech, hitting 200,000 workers this year, according to the tech layoff tracker Layoffs.fyi.

Hardy job gains in May were spread across a variety of industries including government, health care, construction, professional and business services, transportation and warehousing, and social assistance, as consumers have continued to spend heavily on services.

Average hourly wage growth slowed, rising 0.3 % between April and May, up to $33.44 an hour.