May 2025 Jobs Report: Hiring Cools, Unemployment Steady at 4.2%

 The Bureau of Labor Statistics on Friday reported the United States economy added 139,000 jobs in May 2025, a slowdown of around 10,000 jobs after a revision from April’s numbers. The unemployment rate held steady at 4.2% 

Other economic data reported over the last month includes: 

• Total layoffs and discharges increased by nearly 200,000, but the rates of discharges and layoffs for the overall economy remain low around 1.1%. 
• Consumer confidence improved in May after five months of declines. Still, over a quarter of consumers expect business conditions to worsen and fewer jobs to be available six months from now. 
• The two primary inflation measures remain in the low-2s, with the PCE index (surveys all households) at 2.1% and the Consumer Price Index (surveys urban households) at 2.3%. 
• The rate of unemployed persons per job opening remained at an even 1:1 ratio, according to the BLS. There have not been more unemployed persons per job openings since March 2021. 
• Prime age labor force participation (25-54) remains high 83.4%, while the ratio of employed persons to population ratio ticked down to 57.9%, the lowest rate since January 2022, which may highlight a struggle for people outside of the 35-54 age range to find work. 

Healthcare continues to lead the way in adding jobs, with the industry netting 62,000 jobs in May. Leisure and hospitality added 48,000 jobs in May as the summer season arrives, and social assistance added 16,000 jobs. 

While federal government jobs declined by 22,000 last month, state and local government job gains brought overall government employment down by just 1,000 jobs in May. 

Plan for Interest Rates 

The Federal Reserve next meets June 17-18, though they’re not expected to decrease interest rates. Interest rates have held steady around 4.25%-4.5% since the start of the year as the labor market continues to cool. Wages last month increased by 3.9% year over year—the first time it’s dipped below 4% since August 2021—as inflation sits around the low 2s. The Federal Reserve’s target is for inflation to reach 2%.