US hiring and wage growth picked up last month
America’s employers added a strong 272,000 jobs in May, accelerating from April and a sign that companies are still confident enough in the economy to keep hiring despite persistently high interest rates. Last month’s sizeable job gain suggests that the economy is still growing steadily, propelled by consumer spending on travel, entertainment and other services. US airports, for example, reported near-record traffic over the Memorial Day weekend. A healthy job market typically drives consumer spending, the economy’s principal fuel. Though some recent signs had raised concerns about economic weakness, May’s jobs report should help assuage those fears. Even so, Friday's report from the government included some signs of a potential slowdown. The unemployment rate, for example, edged up for a second straight month, to a still-low 4 percent, from 3.9 percent, ending a 27-month streak of unemployment below 4 percent. That streak had matched the longest such run since the late 1960s. President Joe Biden pointed to Friday's jobs report as a sign of the economy’s robust health under his administration. He also charged that congressional Republicans would worsen inflation by cutting health care subsidies and widening the deficit through tax cuts. The presumptive Republican nominee, Donald Trump, has focused his criticism of Biden’s economic policies on the surge in inflation , which polls show still weighs heavily in voters’ assessment of the economy. At a rally in Phoenix on Thursday, he blamed illegal immigration for contributing to higher prices. Economists say the mixed signals from Friday's report – a surge in jobs alongside a slight rise in unemployment – are likely a sign that the job market is normalising after years of distortions related to the pandemic. After the brutal pandemic recession, when unemployment rocketed to nearly 15 percent, hiring soared in 2022 and 2023 as the economy quickly recovered. Wages, before adjusting for inflation, also jumped as businesses desperately sought to fill jobs. The number of open jobs, while still elevated, has fallen to a three-year low, the government said this week. Fewer workers are quitting their jobs, after quits had soared after the pandemic. Many employers say it's become easier to find workers to fill their open jobs. (AP)