Key takeaways:
- Payrolls rose but growth stayed moderate: BLS reported total nonfarm employment grew by 172,000 in May, roughly in line with April’s revised gain of 179,000, with leisure and hospitality, local government, and health care leading the way while financial activities shed jobs.
- Temporary help services gains for a third straight month: BLS shows temp help added 1,400 jobs in May (preliminary), following an upwardly revised gain of 8,700 in April. The sector has now added jobs in March, April, and May, the first three-month run of consecutive gains since early 2024.
- Private sector hiring broad-based but modest: ADP reported 122,000 private sector jobs added in May, with eight of ten supersectors showing gains. Job-changer pay growth slipped slightly to 6.5% while job-stayer pay held steady at 4.4%.
Total nonfarm payroll employment grew by 172,000 jobs in May, according to the latest report from the Bureau of Labor Statistics (BLS). The gain closely matches April’s revised figure of 179,000 and puts the three-month average at 188,000. March was revised up by 29,000 to 214,000, and April was revised up by 64,000 to 179,000. Those two revisions add 93,000 jobs to what was already on the books.
Leisure and hospitality drove May’s headline number, adding 70,000 jobs, well above its 12-month average of 14,000. Food services and drinking places accounted for 48,000 of that gain. Local government added 55,000, mostly outside of education (+44,000). Health care contributed another 35,000, consistent with its 12-month average of 38,000. Social assistance added 12,000.
Financial activities was the only major sector to shed jobs in May, down 22,000. The sector has lost 107,000 positions since a peak in May 2025..
Temporary help services posts third straight monthly gain
Temporary help services added 1,400 jobs in May (preliminary), according to BLS. That’s a small number month-over-month, but it’s the third consecutive monthly gain for a sector that spent most of the past two years contracting. March came in at +8,000; April was revised up to +8,700. The last time temp help strung together three straight months of positive numbers was early 2024.
Temp help employment now stands at 2,490,000, still below the 2,513,100 level from May 2025 and well off the highs. The recovery isn’t complete. But three consecutive months of BLS gains, including an upward revision to April, points to demand starting to stabilize after a prolonged pullback.
The broader professional and business services category added just 6,000 jobs in May. Temp help is carrying most of the positive momentum in that supersector right now.
Other highlights from the May BLS report include:
- The unemployment rate held at 4.3% for the third straight month, with 7.3 million people unemployed. The rate has stayed in a narrow range of 4.3% to 4.5% since July 2025.
- The labor force participation rate held at 61.8%, and the employment-population ratio edged up to 59.2%.
- Long-term unemployment (27 weeks or more) rose to 2.0 million, up 524,000 over the year, now accounting for 27.5% of all unemployed people.
- Short-term unemployment (less than 5 weeks) dropped by 286,000 to 2.2 million, reversing most of a spike from the prior month.
- Part-time employment for economic reasons dipped to 4.8 million, a modest improvement from April.
- Manufacturing added 7,000 jobs, and construction added 17,000. Nondurable goods manufacturing lost 10,000.
Private sector adds 122,000 jobs in May
ADP’s National Employment Report showed private employers added 122,000 jobs in May, with gains across eight of ten supersectors. April’s total was revised down from 109,000 to 105,000. Employers of all sizes were hiring, which hasn’t been the consistent pattern in recent months.
“Hiring was more broad-based in May than we’ve seen in the last few years,” said Dr. Nela Richardson, chief economist at ADP. “The labor market continues to show sustained momentum going into the summer hiring season.”
Education and health services led all sectors with 57,000 jobs added. Trade, transportation, and utilities contributed 36,000. Professional and business services added 11,000. Construction was up 8,000, and manufacturing added 3,000. Information was the only supersector to lose jobs, down 9,000.
Job-stayer pay growth held at 4.4% year-over-year. Job-changer pay growth came in at 6.5%, down slightly from 6.6% in April. The gap between job-stayers and job-changers has narrowed considerably from historical norms. Among job-stayers, financial activities led with 5.1% growth; manufacturing posted 4.8%.
Small establishments (fewer than 50 employees) accounted for 67,000 of May’s gains. Large establishments (500+) added 40,000. The West led regionally with 45,000, followed by the Northeast at 35,000.
