US job market beats expectations with 172,000 additions in May; unemployment steady at 4.3% – Firstpost

The US economy added jobs at a stronger-than-expected pace in May, signalling resilience in the labour market despite inflation concerns triggered by rising oil prices and geopolitical tensions.

Nonfarm payrolls increased by 172,000 jobs in May, following an upwardly revised gain of 179,000 jobs in April, according to data released by the Labor Department’s Bureau of Labor Statistics. Economists polled by Reuters had expected the economy to add 85,000 jobs.

The unemployment rate remained unchanged at 4.3 per cent for the third consecutive month.

The latest data indicates that the labour market is regaining momentum after a slowdown last year. Economists said limited layoffs have helped support employment levels, even as companies remain cautious about aggressive hiring due to uncertainty around trade policies and the ongoing US-Israel conflict with Iran.

The West Asia crisis has pushed oil prices higher due to disruptions linked to the Strait of Hormuz, but economists said there are currently no signs of a significant impact on the US jobs market.

Analysts describe the current employment environment as a “slow-hire, slow-fire” labour market, where companies are avoiding major job cuts while remaining careful about expanding their workforce.

Fiscal support measures, including tax and tariff refunds, have also helped strengthen corporate balance sheets, limiting the need for widespread layoffs. Corporate profits rose by $40.4 billion in the first quarter and have continued improving since the second quarter of 2025.

The stronger-than-expected jobs report could give the Federal Reserve more flexibility to keep interest rates unchanged as it balances labour market strength against inflationary pressures. Financial markets expect the US central bank to maintain its benchmark interest rate in the 3.50 per cent to 3.75 per cent range into 2027.