US Economy: Could Weak May Job Report Numbers Signal A Slowdown?

As U.S. President Donald Trump issued tariff threats against China and Mexico, US hiring slowed down during the month of May.

The U.S. Labor Department said Friday that only 75,000 non-farm jobs were added in May, falling short of a poll with economists done by Reuters predicting that 185,000 jobs would be added.

Hiring weakened in nearly all sectors of the U.S. economy, with employment falling in retail services and government. Wage growth was also slow. On the bright side, the U.S. unemployment rate was only at 3.6%.

White House economic advisor Kevin Hassett said that bad weather was the main reason behind the employment slowdown, and added the report showed a "a little bit of a blip down."

Greg Daco, chief U.S. economist at Oxford Economics, called the May jobs report "disappointing."

"At a time when weak global growth and trade uncertainty have investors increasingly worried about economic weakness, May's soft jobs report only fanned those fears," Alec Young, managing director of global markets research at FTSE Russell said in a report. Young believes that the Federal Reserve will cut interest rates to jumpstart U.S. economic growth due to the indicators in the report.

The U.S. government under Trump has levied a 25% tariffs on Chinese imports, throwing global trade a curveball. He also recently threatened a 10% tariff on imports from Mexico to stem illegal immigration but backed down over the weekend, saying he had made a deal with the Mexican government. This uncertainty could be a big reason why U.S. firms slowed down on their hiring in May.