WASHINGTON (AP) — U.S. employers slowed hiring last month, but still adding a solid 139,000 jobs amid uncertainty over President Trump’s trade wars.
Hiring fell from a revised 147,000 in April, the Department of Labor said Friday. The unemployment rate stayed at 4.2%.
Trump’s aggressive policies – especially his sweeping taxes on imports – have muddied the outlook for the economy and the job market and raised fears that the American economy could be headed toward recession. But so far the damage hasn’t shown up clearly in government economic data.
The U.S. economy and job market have proven surprisingly resilient in recent years. When the inflation fighters at the Federal Reserve raised their benchmark interest rate 11 times in 2022 and 2023, the higher borrowing costs were widely expected to tip the United States into a recession.
Instead, the economy kept growing and employers kept hiring.
But former Fed economist Claudia Sahm warns that the job market of 2025 isn’t nearly as durable as the two or three years ago when immigrants were pouring into the U.S. job market and employers were posting record job openings.
“Any signs of weakness in the data this week would stoke fears of a recession again,” Sahm, now chief economist at New Century Advisors, wrote in a Substack post this week. “It’s too soon to see the full effects of tariffs, DOGE, or other policies on the labor market; softening now would suggest less resilience to those later effects, raising the odds of a recession.’’
Recent economic reports have sent mixed signals.
The Labor Department reported Tuesday that U.S. job openings rose unexpectedly to 7.4 million in April — seemingly a good sign. But the same report showed that layoffs ticked up and the number of Americans quitting their jobs fell, a sign they were less confident they could find something better elsewhere.
Surveys by the Institute for Supply Management, a trade group of purchasing managers, found that both American manufacturing and services businesses were contracting last month.
And the number of Americans applying for unemployment benefits rose last week to the highest level in eight months.
Jobless claims — a proxy for layoffs — still remain low by historical standards, suggesting that employers are reluctant to cut staff despite uncertainty over Trump’s policies. They likely remember how hard it was to bring people back from the massive but short-lived layoffs of the 2020 COVID-19 recession as the U.S. economy bounced back with unexpected strength.
Still, the job market has clearly decelerated. So far this year, American employers have added an average 144,000 jobs a month. That is down from 168,000 last year, 216,000 in 2023, 380,000 in 2022 and a record 603,000 in 2021 in the rebound from COVID-19 layoffs.