Unemployment rate fell to 5.8% in a pickup of the labor market’s recovery

Employers added 559,000 jobs in May and the unemployment rate fell to 5.8%, in a pickup of the labor market’s recovery from Covid-19.

Several factors are propelling a burst of economic activity. More Americans have become vaccinated against the coronavirus, and state and local governments have eased restrictions on businesses as Covid-19 cases have declined and as the federal government has relaxed its pandemic guidance. Those factors, along with federal pandemic aid, have prompted a pickup in spending, particularly at services businesses, which in turn is stoking labor demand.

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Employment in April was still down by about eight million jobs compared with pre-pandemic levels, and nearly 10 million people were unemployed and potentially available to work.

Economists predict that the labor market won’t fully recover until next year despite signs of robust demand for workers. The Federal Reserve, other policy makers and financial markets are closely watching the pace of hiring as a key indicator of strength in the overall recovery.

Strong growth in U.S. job openings is a sign that employers are seeking to boost hiring, although they face challenges in filling positions.

Read more at WSJ