Non-farm payrolls increased by 115,000 last month, after an upwardly revised gain of 185,000 in March, according to data released Friday, May 8, by the US Bureau of Labor Statistics. Economists polled by Bloomberg had expected payrolls to rise by 65,000, while a Reuters survey had forecast an increase of 62,000 jobs.
The unemployment rate held steady at 4.3%, in line with expectations.
Financial markets showed a muted reaction to the data. Stock-index futures held on to gains, Treasury yields remained lower, and the dollar weakened after the release.
The report points to a labour market that is stabilising after a prolonged period of uneven hiring and near-stagnant job growth last year. While demand for workers remains soft, layoffs have stayed relatively low, helping support overall employment conditions. Economists have also noted that slower immigration and demographic shifts have lowered the threshold for what constitutes healthy monthly job creation.
The latest numbers are likely to give Federal Reserve policymakers room to keep interest rates unchanged in the coming months as they assess inflationary pressures stemming from the ongoing conflict involving Iran.
Federal Reserve Chair Jerome Powell had said last week the labour market was showing “more and more signs of stability.”
Reuters reported that economists believe it is still too early for the full economic impact of the US-Israeli conflict with Iran to be reflected in employment data. However, the tensions have already pushed up gasoline and diesel prices, along with the cost of commodities transported through the Strait of Hormuz.
Payroll growth has remained volatile since mid-2025, swinging between gains and losses. Economists attribute part of the inconsistency to adjustments in the government’s ‘birth-and-death’ model, which estimates employment changes linked to businesses opening and closing. Some analysts said rapid turnover among new firms has complicated the Bureau of Labor Statistics’ ability to accurately gauge job creation.
The report also reinforced market expectations that the Fed will likely keep interest rates unchanged well into 2027. The US central bank last week maintained its benchmark overnight interest rate in the 3.50-3.75% range, citing persistent inflation concerns.
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