I’m not sure we need those rate cuts, Kevin.

The US economy added 172,000 jobs on net last month, the BLS said Friday. That was nearly double the blue-chip consensus.

Revisions added 93,000 jobs across March and April’s headlines, which means May’s big beat, impressive as it is given pervasive uncertainty around the war, actually counts as the lowest establishment survey tally of what’s now the best three-month run of US job creation since early 2024.

As the figure shows, the three-month average is 188,000. That’s a remarkable turnaround. That simple metric was negative as recently as February.

The private hiring tally in Friday’s report was 120,000, 30,000 better than expected and bang on the ADP headline for May.

Hiring was broad-based last month, the BLS said, led by leisure and hospitality, which added 70,000 jobs in May, mostly in bars and restaurants. Local government added 55,000 workers, while health care and social assistance chipped in nearly 50,000 between them. Manufacturing payrolls tripled estimates with a 7,000 gain.

Average hourly earnings rose 0.3% MoM and 3.4% YoY. That latter figure’s barely keeping up with core inflation, to say nothing of all-items CPI.

On the household survey side, the unemployment rate was unchanged at 4.3% — 4.296% unrounded. The participation rate was likewise steady at 61.8%.

Note that “steady” is a bit of a misnomer for the participation rate. As the figure reminds you, participation’s trending down and sits at the lowest since late-2021.

We’re now perilously close to a conjuncture where headline CPI inflation’s higher than the unemployment rate. Hold that thought. I may come back to it later.

Note that household survey employment rose, snapping a fourth-month streak of declines which historically presaged an upturn in the jobless rate.

Friday’s BLS release capped a run of uniformly strong jobs data, starting with the fourth-largest monthly increase in job vacancies in 25 years, and continuing through the ADP and Revelio hiring tallies on Wednesday and Thursday, respectively.

Coming quickly full circle, there’s no argument — none — for additional Fed rate cuts currently. Consider:

• The US labor market’s adding jobs at the fastest three-month clip in two years
• Next week’s CPI release will show headline inflation’s running two full percentage points above the Fed’s target
• IG credit spreads are near all-time tights and
• The stock market’s set 20 new records in 36 sessions.

If Kevin Warsh even alludes to an inclination towards near-term rate cuts at the June FOMC meeting, he’ll be mercilessly lampooned by market pundits.

Of course, if he doesn’t allude to rate cuts, he’ll be mercilessly derided by The White House.