What the May job numbers are saying
After impressive results in April, the May 2019 jobs report released on May 7 came as a disappointment. Rising trade war tensions affected May numbers, which missed expectations by a considerable margin.
The US added just 75,000 jobs in May, missing consensus economist estimates of 175,000 compiled by Bloomberg. The unemployment rate held at a 50-year low of 3.6% for May.
The unemployment rate matched the consensus estimates. Average hourly earnings for May were constant at 0.2% month-over-month. Discussing the May Jobs report with CNBC, Beth Ann Bovino, US chief economist for S&P Global Ratings, said they had expected a slowdown of around 200,000 for May—but the actual numbers are a disaster.
The labor market change affects the Federal Reserve’s decision to hike or cut interest rates. With the declining job growth and rising trade tensions, the question is whether the Fed will be heading toward a cut to benchmark interest rates.