The U.S. labor market added 147,000 jobs in May, according to the Labor Department, showing continued hiring even as the pace stayed below some recent months. The unemployment rate also moved higher, rising to 4.2% from 4.1% in April.

The report suggests the economy is still creating work, but not without signs of cooling. Employers continued to expand payrolls across parts of the economy, while the uptick in unemployment points to a labor market that remains resilient but less tight than it was earlier in the year.

Monthly jobs data are closely watched as a gauge of consumer spending, wage pressure, and the broader outlook for growth. A modest increase in unemployment alongside solid job creation can signal that demand for workers is easing, even if layoffs remain limited.

The figures add another data point to debates over the direction of the U.S. economy, with policymakers and investors looking for signs of whether hiring will slow further in the months ahead.