The U.S. economy added 139,000 jobs in May 2025, signaling continued but slower growth as the labor market shows signs of cooling. The unemployment rate held steady at.2% for the third consecutive month, remaining near historic lows even as job creation moderated compared to earlier in the year.
Health care and leisure and hospitality led job gains, adding 62,000 and 48,000 positions respectively, while federal employment declined by 22,000. Wage growth outpaced inflation, with average hourly earnings rising 0.4% for the month and up.9% year-over-year.
Despite steady headline numbers, underlying data point to subtle weakening. The employment-to-population ratio and labor force participation rate both dipped, and there was a modest uptick in job separations, indicating more people lost or left jobs than found new ones Economists note that ongoing uncertainty over tariffs and policy is causing businesses to act cautiously, retaining workers but slowing new hiring.
Overall, while the May jobs report reflects resilience, it also highlights a labor market that is steady but increasingly cautious as economic headwinds persist.
