Actalent Labor Market and Economy Report: A Look at Trends in May 2024

Executive Summary

Job Growth

The U.S. economy added 272,000 jobs in May.

Healthcare, trending persistently upward since June 2022, led the way for the fourth consecutive month, adding 68,300 jobs. Government also grew by 43,000 jobs in May, adding the second most jobs among all sectors. Over the last twelve months, government has net-gained 617,000 jobs, second only to healthcare with 781,900.

Outside of healthcare, other industries Actalent supports saw job growth as follows: aerospace and defense (+1,100), architecture and engineering (+9,900), automotive (+3,100), construction (+21,000), manufacturing (+8,000), scientific research and development (+100), and utilities (+1,300).

Meanwhile, job openings declined to 8.1 million in April (based on the most recent data), which is the lowest level since February 2021 but still above the pre-pandemic norm.

Unemployment and Labor Force Participation

The unemployment rate increased from 3.9% in April to 4.0% in May, marking the first time it has hit 4.0% since January 2022.

Meanwhile, the labor force participation rate declined from 62.7% to 62.5%, indicating the share of people working or looking for work shrunk slightly.

Unemployment rates, specific to the industries Actalent supports, were as follows for May: hospitals (1.7%), utilities (2.4%), professional and technical services (3.1%), manufacturing (2.8%), and construction (4.8%).

Among skilled labor categories Actalent sources talent for, unemployment in software-IT-mathematics was 2.8%; architecture and engineering was 1.9%; and sciences (life, physical and social) was 1.8%.

Inflation

The year-over-year inflation rate was 3.3% in May, dipping just below April’s rate of 3.4%. This is the second month in a row that inflation has eased, albeit slightly. The drop is due in part to declining gas prices. Rising shelter prices, however, which increased again for the fourth straight month, continue to work against inflation reaching 2.0%.

Wage Growth

Average hourly earnings increased 4.1% between May 2023 and May 2024. “Real" average hourly earnings (wages adjusted for inflation) increased 0.8% from May 2023 to May 2024, a turn upward from April’s 0.5% increase. Average hourly earnings are keeping pace with inflation, but consumers are still feeling the pressure of higher prices.