🇺🇸 **U.S. Job Market Shows Resilience in May, But Clouds Are Gathering**

The U.S. labor market in May beat expectations, with the economy adding 139,000 nonfarm jobs—slightly above the forecast of 130,000. While the figure marks a small dip from April’s revised 147,000, it still signals steady momentum.

Healthcare led the gains, contributing 62,000 new jobs, particularly in hospitals and outpatient services. Hospitality wasn’t far behind, adding 48,000 positions, largely from restaurants and bars. Social assistance also made modest strides, with 16,000 additional roles.

Yet, not all sectors fared well. The federal government cut 22,000 jobs in May, amounting to 59,000 since the start of the year. Manufacturing saw a slight contraction with 8,000 jobs lost. On top of that, March and April employment figures were revised down by a combined 95,000.

The unemployment rate held steady at 4.2%, maintaining the range seen over the past year. Breaking it down: unemployment among adult men and women stood at 3.9%, teens at a much higher 13.4%. By ethnicity, the rate was 3.6% for Asian Americans, 3.8% for White workers, 6.0% for Black workers, and 5.1% for Hispanic workers.

Markets responded positively, with the Dow Jones climbing nearly 200 points, reflecting investor belief in the economy’s underlying strength. Rate traders are currently pricing in two rate cuts by the Federal Reserve—one in September, another in December.

However, a contrasting view comes from the ADP private payroll report, which showed just 37,000 new jobs—well below expectations and the weakest reading in over two years. ADP’s chief economist, Nela Richardson, noted that hiring momentum has “noticeably slowed,” even as wage growth remains steady for both current and job-switching workers.

Looking ahead, while the job market has held up so far, growing economic uncertainty and potential policy shifts from the Trump campaign are prompting concern about a slowdown in hiring. Trump’s reaction to the weak ADP data was swift—calling for an immediate rate cut and criticizing Fed Chair Jerome Powell for falling behind: “Europe has cut rates nine times… what is he waiting for?”

As early signs of labor market cooling emerge, the next few months will serve as a key barometer for the broader economy—and a guide for where monetary policy is headed. For investors, employers, and job seekers alike, a shift in pace may be on the horizon for the rest of 2024.