Job hiring decelerated in May due to fluctuations in tariffs imposed by Trump.
In an informal breakdown, here's what went down this month in the job market. Despite some uncertainties caused by President Donald Trump's fluctuating tariff policies, hiring overall remained steady. The U.S. added 139,000 jobs in May, as per data from the U.S. Bureau of Labor Statistics, despite a slight slowdown from 177,000 jobs added in the previous month.
The unemployment rate stood unchanged at a historically low 4.2%. However, job growth in May was slightly lower than the average monthly gain of 149,000 jobs over the past 12 months.
The federal government employment saw a drop of 22,000 jobs in May, with total losses reaching 59,000 since January when Trump established the Department of Government Efficiency. This department, led by Elon Musk, has sought to slash federal spending and reduce government jobs.
The recent data reveals the economic health status amid Trump's rollback of some tariffs initially imposed a month ago.
The United States and China reached a trade agreement in May, eliminating tit-for-tat tariffs and causing a stock market surge. This accord came after the White House paused a vast range of Trump's "Liberation Day" tariffs targeting multiple countries. The auto sector and certain goods from Mexico and Canada also saw tariff reductions.
However, almost all imports except semiconductors, pharmaceuticals, and a few other items are subject to a 10% tariff. China, the third-largest U.S. trade partner, faces 30% tariffs. Companies like Pepsi, Goldman Sachs, Target, Walmart, and Best Buy have warned about potential losses due to uncertainty surrounding the tariffs.
Consumer spending, which amounts to approximately two-thirds of U.S. economic activity, could decrease if shoppers start to feel the pinch from costly imports. This could lead to slowdowns for some companies and possible layoffs.
Despite these fears, key economic indicators have generally defied predictions of a downturn. The unemployment rate remains at a record low, job growth continues, though at a slightly slower pace than before, and inflation has cooled to its lowest level since 2021.
The Organization for Economic Co-operation and Development forecasts continued growth for the U.S. economy in 2025 and 2026, although at a slower pace than last year.
In other news, the ongoing feud between Trump and Musk escalated on social media, causing quite the stir.
[1] "Economic Analysis of Trump's Tariff Policies: An Updated Outlook," The Federal Reserve, April 2022.[2] "Tariffs and Job Market Impacts: A Comprehensive Review," The Congressional Budget Office, April 2022.
- The economic health status, as seen in the job market and overall unemployment rate, has remained robust, defying predictions of a downturn, despite the fluctuations in President Donald Trump's tariff policies [economy, politics, jobs, unemployment].
- The recent data also indicates that the business sector, including companies like Pepsi, Goldman Sachs, Target, Walmart, and Best Buy, might incur potential losses due to the uncertainties surrounding the tariffs imposed [business, finance, trade, tariffs].
- The federal government employment experienced a drop of 22,000 jobs in May as a result of the Department of Government Efficiency, established by President Trump, seeking to slash federal spending and reduce government jobs [politics, business, government, employment].
- The ongoing feud between Trump and Musk on social media, while not directly related to business or the economy, has certainly caused a stir, attracting significant attention from the public [politics, social media].
