The US economy added slightly more jobs than expected in May, but payroll growth was slower than initially reported during the prior two months, the BLS said Friday.

At 139,000, the NFP headline topped the 125,000 consensus due entirely to private payrolls, which expanded by 140,000, ahead of estimates and nearly four times the private employer additions tallied by ADP for May.

Between them, March and April’s headlines were revised lower by 95,000. With the revisions and the May headline, the three-month average stands at 135,000, the fastest since February.

As a reminder (and a point of reference), monthly NFP growth averaged 168,000 in 2024.

The headline beat may offer a measure of respite for markets unnerved by the ADP miss and another uptick in initial jobless claims. That said, the details weren’t what I’d call robust.

For example, hiring was concentrated entirely in health care, leisure and hospitality and social assistance. If you ask me, there’s nothing wrong with that. But to let some of the Trump-leaning Wall Street crowd (and sundry right-wing bloggers) tell it, an economy where hiring’s concentrated in health care, social assistance, education and restaurants is an inferior economy. They won’t say that on Friday because this is a Trump-era jobs report, but that’s their narrative when a Democrat’s in the Oval Office.

Federal government employment contracted 22,000 in May, bringing the YTD drop to 59,000. Employees on paid leave or receiving ongoing severance pay are counted as employed in the establishment survey. To me, that sounds like a latent drag on the NFP headline — a hit in-waiting.

Note that the participation rate ticked down in May to 62.4%, tied with February for the lowest reading since January of 2023. That casts the “steady” unemployment rate — 4.2% — in a negative light. Unrounded, the jobless rate rose on the month (to 4.244% from 4.187%).

The household survey notched a 696,000 decline, tied for the largest drop since the onset of the pandemic. That made for a rather stark contrast with the NFP headline.

The figure gives you some context for the disparity looking back to 2021.

On the wage growth front, average hourly earnings rose 0.42% MoM and 3.9% YoY, both warmer than expected. You can look at that two ways. On one hand, it’s good news for households who’re likely to struggle with tariff-related price hikes. But it’s corrosive to margins already pinched by upward pressure on input costs from the trade war.

All in all, this doesn’t change the overarching narrative which says the US labor market’s “resilient” (and Jesus Christ that’s becoming a clichéd term by now in the US macro context). And yet, to reiterate, this didn’t look like an especially favorable report to me. I’d call it “mixed.” Speaking of macro clichés.