WE work growth continued at a sustained pace in May, driven by hiring at restaurants and bars despite concerns about an impending slowdown and record inflation.
Employers added 390,000 jobs in May, the Labor Department said in its monthly payrolls report released Friday, surpassing the 328,000 jobs predicted by economists at Refinitiv. The unemployment rate, meanwhile, remained stable at 3.6%, the lowest level since February 2020.
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“It doesn’t look like a job market on the verge of tipping into recession,” said Daniel Zhao, senior economist at jobs review site Glassdoor. “Jobs gains have been healthier than expected and labor force participation has increased. Despite concerns about a slowdown and even a recession, labor market fundamentals look healthy.”
Leisure and hospitality, one of the sectors hardest hit by the pandemic that has become something of an indicator of economic recovery, saw a gain of 84,000 new jobs last month. Restaurants and bars saw an increase of 46,100, while hotels added 21,400 jobs last month. In total, employment in the sector is down by around 1.3 million, or 7.9%, compared to February 2020.
“Notable employment gains were in recreation and hospitality, professional and business services, and transportation and warehousing. Employment in retail trade declined,” the report said. Department of Labor in the report.
Professional and business services accounted for the second strongest job growth in May, with payrolls rising by 75,000. The increases were widespread across the industry. computer systems design and related services increased by 13,100, accounting and bookkeeping services jumped by 15,600, and management and technical consulting services increased by 6,800. Employment in the industry is actually 821,000 jobs higher than it was in February 2020.
Transportation and warehousing also saw a hiring boom last month, with the onboarding of 47,000 new employees. There has been a big jump in the hiring of heavy truck and tractor-trailer drivers, with the sector adding 13,300 new workers last month. Air transport also climbed with 5,700 new employees.
“Economy-wide hiring remains robust and the workforce is benefiting from strong wage gains that will continue to support spending and likely stave off a near-term recession,” said the chief economist of RSM, Joe Brusuelas. “However, one can clearly see a residual slowdown in hiring across most rate-sensitive sectors.”
The government also recruited many new employees last month, with the payroll increasing by around 57,000. The bulk of these stemmed from the increase in state government education (36,300) and local government education (14,400).
Another source of job creation in May was the health care and social assistance sector, up 42,100. Hospitals hired 16,300 new employees, while individual and family services saw their payrolls increase by 13,000. Ambulatory health care services, including offices of doctors, dentists and other health professionals, increased by 6,400.
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Employment in other industries, including construction (36,000), manufacturing (18,000), wholesale trade (14,100) and financial activities (8,000), also rose last month.
Only one sector saw a decline last month: retail trade, which plunged 60,700. The decline was most pronounced in general merchandise stores, as employment fell 32,700.