The economy added 38,000 jobs in May, the Bureau of Labor Statistics reported on Friday. The unemployment rate dropped to 4.7 percent.
The monthly jobs tally is far below the 160,000 new jobs that economists had forecast for May, and continues a steep dropoff in monthly hiring after two years of strong job growth.
May’s job gains came primarily in the health care sector, which added 46,000 workers. But durable-goods manufacturing jobs fell by 18,000, jobs in the information industry fell by 34,000, and the mining sector continued shedding workers. Other sectors were little changed.
There is more bad news in the bowels of Friday’s report, as the economy created almost 60,000 fewer jobs in recent months than initial BLS reports had indicated. March job growth was revised downward from 208,000 to 186,000, and the April figure was revised to 123,000 from 160,000.
Wages continued to drift higher very slowly, climbing by 5 cents per hour on average across all workers in May. That’s down from a 9-cent bump the previous month. Wage growth now sits at 2.5 percent over the past year.
In 2015, the economy generated 229,000 jobs per month on average. That pace appeared to be continuing in the first months of this year, but April’s figure was paltry even before Friday’s revisions, and May’s number marks a far steeper shift.
Some of that severity owes to the lengthy Verizon strike, which took some 35,000 workers off the job for weeks at the communications giant. That blip explains the sudden reversal in the information sector, which has generally shown steady job growth throughout the past year.
But there are also genuine economic headwinds blowing. The overall economy barely grew at all in the first quarter of the year.