The job growth in the United States likely lost momentum in May as businesses focussed on cutting costs and stalling new investments because of ongoing changes in trade policy, as per Bloomberg. The survey projects payrolls increasing by 125,000 last month, a decline from stronger hiring numbers observed earlier this year.
US job markets remain stable but cautious
May’s expected job gains indicate a slowdown, the three-month average would still hang over at a healthy 162,000. The employment rate is predicted to hold firm at 4.2%. Employers seem to be cautious amid unclear announcements from the White House on tariffs and import duties. US President Donald Trump has been using trade initiatives to boost domestic production and shift priorities towards investment.
“Employers seeking clarity around the White House’s trade policy have instead been greeted with frequent adjustments to timelines and import duty schedules,” Bloomberg stated.
Indication of ease in business and consumer activity
Consumer spending is predicted to be at ease because recent confidence surveys show growing restraint among households. In terms of auto sales data from Ward’s Intelligence also projected to show a downturn in May for the two months continuously, further flagging weakening demand. On the business side, job vacancies may have dropped to 7.1 million in April, it has been predicted as the lowest since late 2020.
Companies are concerned that revenues may dip and are reacting by limiting their budgets, which could timely reflect on the hiring process.
Meanwhile, the Federal Reserve officials are keeping a watch on the labour market, with speeches likely this week from governors Adriana Kugler, Chritopher Waller and Lisa Cook.
On the global front, economists anticipate a drop in the US trade deficit and a possible GDP rebound in the second quarter. As per the report, the Bank of Canada is facing tough rate decisions and central banks across Asia and Europe are expected to make policy revisions.
The Bloomberg report added, ‘’concerned that revenue will suffer, companies are growing more conscious of about cost-saving efforts.’’