U.S. May Nonfarm Payrolls Jump 172,000, Far Exceeding Forecasts; Unemployment Steady at 4.3%

The U.S. economy added 172,000 nonfarm jobs in May, nearly double the 80,000 estimate from Dow Jones economists, the Labor Department reported on Friday, June 5, 2026. The unemployment rate held at 4.3%, matching forecasts. The robust report sent U.S. stock futures lower and bonds tumbling, with the 2-year Treasury yield rising over 7 basis points to 4.1%, as traders priced in a quarter-point Federal Reserve rate hike by year-end. Job gains were led by leisure and hospitality, which added 70,000 positions, while health care and social assistance, a steady driver, continued strong hiring. Construction and manufacturing also posted gains. The data surprised after months of muted expectations and a “low hiring, low firing” environment. The strong labor market may complicate the Fed’s inflation fight. Officials, already ruling out further rate cuts, had turned more optimistic on employment but remain focused on sticky inflation. The central bank is in wait-and-see mode after delivering three rate cuts totaling 0.75 percentage point in the second half of 2025.