Expanding Payrolls: What We Learned During the Week of June 1 – 5

Employers added workers and have more jobs to fill. Here are five things we learned from U.S. economic data released during the week ending June 5. 

1. A third consecutive strong jobs report in May. The Bureau of Labor Statistics estimates that nonfarm payrolls expanded by a seasonally adjusted 172,000, following gains of +214,000 and +179,000 in the two previous months. (The March and April estimates include a combined upward revision of 93,000 jobs.) Private-sector payrolls grew by 120,000. Driving payroll growth were leisure/hospitality (+70,000), local government (+55,000), and health care/social assistance (+47,200). Average weekly earnings of $1,287.28 were up 3.7 percent from a year earlier.

A survey of households keeps the unemployment rate at 4.3 percent and has the labor force growing by 83,000 people. The labor force participation rate held steady at 61.8 percent, while the 25-54 participation rate added 0.1 points to 83.9 percent (near its record high of 84.6 percent set 27 years ago). The median duration of unemployment increased by 0.6 weeks to 11.6 weeks, while the number of people working part-time for “economic reasons” declined by 137,000 to 4.805 million. The broadest measure of labor underutilization (the U-6 series) slipped 0.1 points to 8.1 percent. 

2. Hiring slowed, and the number of unfilled jobs rose in April. The number of job openings swelled by 731,000 to a seasonally adjusted 7.618 million, according to the Bureau of Labor Statistics. There were 7.3 percent more open jobs than a year earlier. The private sector had 6.841 million unfilled jobs, with health care/social assistance, professional/business services, and trade/transportation/utilities each having at least a million job openings. Hiring declined by 419,000 to 5.116 million (-5.1 percent versus April 2025). The count of job separations also fell by 399,000 to 4.978 million (-5.5 percent versus April 2025). This included 2.977 million people who quit their jobs (-183,000 versus March 2026) and 1.692 million layoffs (-192,000 versus March 2026).

3. Manufacturing activity grew in May. The Manufacturing PMI added 1.3 points to 54.0. This marked the fifth consecutive month that the Institute for Supply Management (ISM) measure was above 50.0, indicating an expanding manufacturing sector. Measures increased for new orders (56.8), production (54.3), employment (48.6), and inventories (49.9). Sixteen of 17 manufacturing sectors reported growth in May, led by printing, textiles, and nonmetallic mineral products. The sole contracting manufacturing industry was wood products.

4. …As did that in the service sector. The ISM’s Services PMI increased by 0.9 points to 54.5, extending the service sector’s winning streak (i.e., 50.0+ readings) to 23 months. Indices for business activity/production (57.7), new orders (57.3), and inventories (62.5) rose. The employment measure slipped to 47.9. Seventeen of 18 service sector industries expanded in May, led by wholesale trade, arts/entertainment/recreation, and construction. Survey respondents noted that new orders increased, but “most frequently attributed this to seasonality.”

5. Factory orders jumped in April. The Census Bureau reports that new orders for manufactured goods rose 4.8 percent to a seasonally adjusted $662.7 billion. Factory orders totaled $2.499 trillion year-to-year, 6.0 percent above the comparable 2025 months. Durable goods orders surged 8.0 percent (transportation goods: +21.6 percent), while nondurable goods orders advanced 1.4 percent. Shipments grew 1.0 percent to $641.0 billion, with year-to-date shipments at $2.464 trillion (+5.2 percent versus comparable 2025 months). Unfilled orders increased 1.7 percent to $1.569 trillion, while inventories expanded 0.3 percent to $959.1 billion.

Other U.S. economic data released over the past week:

• Jobless Claims (Week ending May 30, 2026, First-Time Claims, seasonally adjusted): 225,000 (+13,000 vs. the previous week, -19,000 vs. the same week a year earlier). 4-week moving average: 214,750 (-7.7% vs. the same week a year earlier).
• Vehicle Sales (May 2026, Auto and Light Truck Sales, seasonally adjusted annualized rate): 16.083 million (+0.4% vs. April 2026; +3.2% vs. May 2025).
• Construction Spending (April 2026, Value of Construction Put in Place, seasonally adjusted): $2.172 trillion (+0.4% vs. March 2026; +0.9% vs. April 2025).
• Productivity (2026Q1-revised, Nonfarm Labor Productivity, seasonally adjusted annualized rate): +0.3% vs. 2025Q4; +2.8% vs. 2025Q1.
• Consumer Credit (April 2026, Consumer Credit Outstanding (Non-Real Estate), seasonally adjusted): $5.153 trillion (+$20.7 billion vs. March 2026; +2.3% vs. April 2025).
• Beige Book

The opinions expressed here are not necessarily those of Kevin’s current employer. No endorsements are implied.