Job creation disappointed again in May, with a spike in non-farm payrolls that would normally be viewed as a solid 559,000 but still falls short of high expectations, the Labor Department reported Friday.
According to economists polled by Dow Jones, the number of employees is expected to rise by 671,000.
The unemployment rate fell from 6.1% to 5.8%, which is better than the estimate of 5.9%. An alternative measure of unemployment, which includes discouraged workers and part-time workers for economic reasons, fell to 10.2%.
The May disappointment came after April fell well below expectations, with the revised upward of 278,000 still well below the original estimate of 1 million, which was accompanied by high hopes for an economy trying to loosen its pandemic shackles.
The markets were not disappointed with the report. Stock market futures even rose, with investors continuing to bet that the measured pace of employment growth would deter the Federal Reserve from hike rates and tighten monetary policy.
Employment-to-population ratios, cited by some Fed officials as an important gauge of job progress, rose to 58% but remained well below pre-pandemic levels of 61.1%.
The decline in Covid-19 cases along with a continued high pace in vaccines has led elected leaders to relax the restrictions put in place to stop the virus from spreading. The economy grew 6.4% in the first quarter and is well on its way to accelerating 10.3% in the second quarter, according to the latest data from the Atlanta Federal Reserve.
By May, the U.S. economy had restored around 14.3 million of the 22 million jobs lost in the early days of the pandemic.
The services industry suffered the biggest blow from the pandemic lockdowns and continued to lead the way in job creation in May.
In the leisure and hospitality industry, 292,000 jobs were added, with the majority of 186,000 in restaurants and bars.
Public and private education also saw the benefits of the reopening, adding a total of 144,000. Other increases came from health and social assistance (46,000), information (29,000), manufacturing (23,000), transportation and warehousing (23,000), wholesale (20,000) and professional and business services (35,000).
Construction lost 20,000 jobs while retail sales also fell 6,000.
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