U.S. jobless rate lowest since 2000

Hourly wages up, but growth is slow

The U.S. economy added 223,000 jobs in May as U.S. companies continued their hiring spree, according to the Labor Department’s monthly jobs report released Friday. The unemployment rate fell to 3.8 percent, the lowest since 2000.

Many economists predict the unemployment rate will fall even further this year, potentially dropping to 3.5 percent, which would be the lowest rate since 1969. Wage growth ticked up slightly to 2.7 percent over the past year, but is still sluggish.

“The labor market is continuing its longest streak of job growth on record,” said Martha Gimbel, researcher director at Indeed.com, an employment website. “This recovery is showing no sign of slowing down.”

Hiring was strong across the board with retail and health care leading the surge in May. Bluecollar jobs have also picked up in the past year as rising oil prices and the global economic rebound are driving more demand for construction and manufacturing workers.

The United States has gained 95,000 manufacturing jobs and 110,000 construction jobs from the start of the year through May. Hiring in manufacturing is off to the best start this year since 2011.

Executives at many companies complain they can’t find enough workers. But the pickup in hiring this year suggests they are still adding to their head count and more people are reentering the job market after taking time off for health reasons, taking care of family or just because they didn’t think there were enough opportunities for them.

Job gains have averaged 207,000 a month this year, a faster pace than last year or the year before.

While American companies remain on a hiring spree, they continue to be reluctant to raise wages. The annual pace of wage growth in May was just 2.7 percent, which is barely above inflation.

Economists have been predicting that wages would start to shoot up as companies found it harder to find workers to fill openings and tried to keep star employ-

ees from leaving for other firms. While there have been occasional reports of wage increases such as a Chick-fil-A restaurant in Sacramento hiking pay from $13 to $18 an hour, the national data are still not showing much of a widespread increase in pay.

“Small- and mediumsized businesses don’t have the capacity to raise wages that fast,” said Gregory Daco, chief U.S. economist at Oxford Economics.

This economic expansion is now the second longest in modern American history, behind only the 1990s tech boom that saw widespread job and wage gains for people across the income and skills spectrum. There are encouraging signs that more Americans are benefitting from today’s hot jobs market.

Unemployment for African-Americans has fallen to the lowest level on record, dropping below 6 percent for the first time ever, an encouraging sign that President Trump played up in a speech Friday at a Coast Guard ceremony. The Hispanic rate is also close to its lowest level since the Labor Department began tracking the unemployment rates for minority groups in the early 1970s.

While African-American unemployment is still above that of whites, the gap has narrowed to the lowest ever. The unemployment rate for Americans who graduated high school but didn’t attend college has also fallen sharply in recent months from 4.5 percent in January to 3.9 percent in May.