U.S. Adds 350,000 Jobs in May, Crushing Estimates as Labor Market Stays Hot

The U.S. economy added 350,000 jobs in May, the Labor Department reported on June 5, 2026, far exceeding the consensus forecast of 190,000 and signaling persistent strength in the labor market. The unemployment rate unexpectedly fell to 3.4% from 3.6%, retouching a multi-decade low. Average hourly earnings rose 0.4% month-over-month, accelerating from a 0.2% gain in April and pushing the annual wage growth to 4.1%. The blowout data immediately shifted market pricing for the Federal Reserve’s next policy meeting, with traders sharply cutting bets on a rate cut in July. The outsized payroll gain, broad-based across services and construction, challenges the narrative of an imminent economic slowdown and strengthens the case for the U.S. central bank to keep interest rates elevated for longer. Treasury yields and the U.S. dollar index surged in the wake of the report.