FILE PHOTO: Signage for a job fair is seen on 5th Avenue in Manhattan, New York City, U.S. REUTERS/Andrew Kelly
NEW YORK: The pace of US hiring probably slowed in May, with employers focusing on containing costs as households become a bit more guarded and businesses reconsidered investment plans against a backdrop of shifting trade policy.
Economists see payrolls rising by 125,000 after job growth in March and April exceeded projections, based on the median of a Bloomberg survey.
That would leave the average over the past three months tracking a still-solid 162,000. The unemployment rate is seen holding at 4.2%.
Employers seeking clarity around the White House’s trade policy have instead been greeted with frequent adjustments to timelines and import duty schedules.
President Donald Trump is deploying tariffs as a way to reverse imbalances, spark long-term investment in the United States and spur the domestic output of critical goods and materials.
Meanwhile, economic activity has settled back, with confidence surveys hinting at more modest consumer spending in the coming months.
Auto sales figures from Ward’s Intelligence on are expected to show purchases eased in May for a second month.
Concerned that revenue will suffer, companies are growing more conscious about cost-saving efforts that risk culminating in slower labour demand.
The jobs figures on Friday will follow today’s report on vacancies.
The median projection calls for a decline in April to 7.1 million job openings, the fewest since the end of 2020.
“Our preliminary forecast range for May non-farm payrolls is 60,000 to 130,000, with the central tendency clustering around 90,000, lower than the consensus of 130,000 at the time of writing,” said economist Anna Wong.
“We think one sector – leisure and hospitality – accounted for most of the weakness, as subpar international tourism and a pullback in government travel led to a slump in demand.
“However, construction, and transportation and warehousing – two sectors that typically provide the next most-important seasonal job growth in May – are holding up,” she added.
Federal Reserve officials are likely to take the labour market reports in their stride as they too await clarity on how trade and tax policy will impact the economy and inflation. — Bloomberg
