Mixed Signals in US Job Market Despite Strong May Gains

Despite the addition of 339,000 jobs in May, signs of a cooling job market include a rise in unemployment rate, decline in average work week, and a decrease in the share of unemployed workers finding a job. Employers are opting to hold onto workers through labor hoarding, but this practice can only continue for so long if sales and profits don't pick up. Wage pressures are easing as employers' bargaining power strengthens in a cooling market. The mixed messages present a conundrum for the Federal Reserve wrestling with whether to pause its aggressive flurry of interest rate increases this month or continue to hike rates to cool the economy and inflation.