CUNA Senior Economist Dawit Kebede issued the following statement in response to the Labor Department’s May Employment Situation:
“The economy added 339,000 jobs in May, which was much higher than the consensus expectation, signaling a stronger labor market. The report also revised up job gains in the prior two months by 93,000, bringing the three-month average job growth to 283,000.
“The average hourly earnings grew at an annualized rate of 3.7%, indicating moderating wage growth. The average workweek also declined slightly in May. This shows that the labor market is less tight compared to previous months, despite strong hiring.
“The employment situation report is based on two different surveys conducted by the Bureau of Labor and Statistics. The household survey is used to calculate the unemployment rate, while the establishment survey portrays the number of jobs employers added. The unemployment rate increased from 3.4% to 3.7% in May as households reported an increase in the number of people unemployed.
“The report supports the Federal Reserve's inclination to pause rate hikes in June. Although strong headline job numbers indicate continued hiring demand by employers, the increase in the unemployment rate, moderating wage growth, and decline in the average workweek all indicate moderating labor market conditions."