WASHINGTON (AP) – U.S. employers added 390,000 healthy jobs in May, expanding the range of strong jobs that have boosted the economy under pressure of high inflation and interest rates.
Growth last month reflects a healthy job market, even as the economy weakens in the coming months as the Federal Reserve continues to raise rates to fight inflation. The unemployment rate remained unchanged at a low of 3.6%. The Department of Labor announced this on Friday.
Many companies in the industry are still desperate to hire because their clients continue to spend independently despite growing concerns about high inflation. Americans ’finances grew because of unusually large wages and savings accumulated during the pandemic, especially from high -income families.
Workers typically enjoy almost unprecedented commercial power. The number of people leaving work, often with higher salaries for better positions, is at a record high in six months.
The strength of the labor market itself contributes to inflationary pressures. As wages rise in the economy, companies still pass on some of the rising labor costs to their customers in the form of higher prices. Spending on food, gas, rent and other commodities – all not worth it for low -income families – has been accelerating at an almost rapid pace in 40 years.
Inflation began to rise last year as strong demand for cars, furniture, electronics and other physical goods hit a tight supply chain and shortage of parts. Recently, prices for services such as plane tickets, hotel rooms, and restaurant meals have risen as Americans shifted most of their spending to these areas.
The Federal Reserve’s rapid rate hike, which will be the fastest in more than 30 years, could weaken the economy. To reduce spending and slow inflation, the central bank last month raised the short -term interest rate by half a point, the biggest increase since 2000, from 0.75% to 1%.
Two more half-point rate hikes are planned for this month and July. And some Fed officials have suggested in recent speeches that if inflation shows no signs of slowing, they could implement another half -point in September.
Fed measures have sharply increased mortgage rates and helped reduce new and existing home sales. Rising rates also increase the amount of business loans, which can be offset by a reduction in investment in new buildings and equipment, which will slow down the growth process.
Source: Huffpost
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.