In May, private sector employment rose by 122,000, marking an increase from April's revised total of 105,000 and exceeding the Dow Jones estimate of 110,000. This growth represents the strongest month since January 2025 and reflects a more diverse hiring landscape, with eight out of ten sectors experiencing job gains.
Notably, education and health services led with 57,000 new hires, while trade, transportation, and utilities added 36,000. Smaller companies, those with fewer than 50 employees, were the most significant contributors, adding 67,000 jobs.
The report also noted that annual pay for employees who remained in their positions increased by 4.4%, consistent with April, while pay growth for job switchers decreased slightly to 6.5%. Following the report, stock market futures showed mixed reactions, and Treasury yields rose.
This data comes just ahead of the Bureau of Labor Statistics' nonfarm payrolls report, which is anticipated to show a growth of 80,000 jobs, with the unemployment rate expected to remain at 4.3%.
Federal Reserve officials are likely to closely monitor these employment figures as they prepare for their upcoming policy meeting, where the market expects the central bank to maintain its current interest rate range of 3.5%-3.75%