U.S. Job Growth Slows Amid Tariff Uncertainty and Economic Headwinds

U.S. job growth decelerated in May with nonfarm payrolls rising by 139,000, reflecting concerns over tariff unpredictability and pulling back expectations for Federal Reserve rate cuts. The unemployment rate steadied at 4.2%. Economists predict continued impacts of immigration and spending policy on future employment trends.

U.S. job growth cooled in May as ongoing tariff uncertainties cast shadows over economic outlooks, holding the unemployment rate steady at 4.2%, and potentially delaying Federal Reserve interest rate adjustments. Employment rose by 139,000 last month, a slowdown from the revised 147,000 jobs added in April, according to the Labor Department's Bureau of Labor Statistics.

Economists had projected job growth of 130,000 for May, with estimates ranging from 75,000 to 190,000. The steady 4.2% unemployment rate reflects continuing workforce tensions amid a political backdrop of hardened immigration policies. The creation of at least 100,000 jobs monthly is necessary to keep pace with population growth, but recent policies could change that benchmark.

Businesses continue to practice worker retention in the face of unpredictable tariff policies, complicating future planning. Opposition to economic policies such as tax cuts adds another layer of difficulty for businesses to navigate. The reluctance to lay off workers signals that the Federal Reserve may hold off on policy changes until later in the year, with market expectations pointing to stable rates until September.

(With inputs from agencies.)