U.S. adds 139,000 jobs in May as unemployment rises to 4.2%

The U.S. economy added 139,000 jobs in May, according to Labor Department data, but the pace of hiring continued to cool. The unemployment rate also edged up to 4.2%, marking the highest reading since late 2021.

The report suggests the labor market remains resilient, even as momentum weakens from earlier in the year. Gains in payrolls were enough to keep job growth positive, but not strong enough to prevent a rise in unemployment.

Economists often watch both figures together because they can point to broader shifts in labor demand. A slower hiring pace and a higher jobless rate may signal growing caution among employers as economic conditions evolve.

The May data will likely feed into debates over the Federal Reserve's next steps, as policymakers weigh signs of cooling employment against other measures of inflation and growth.