Economic Shift: U.S. Job Gains Slow Amid Government Cuts

WASHINGTON (AP) — U.S. employers added a solid 139,000 jobs in May 2025, amid ongoing uncertainty over President Donald Trump’s economic policies. Hiring slowed from a revised 147,000 jobs in April, according to the Department of Labor‘s report released Friday.

While the job gains were slightly higher than the 130,000 jobs economists had forecast, revisions took away 95,000 jobs from previous months. The unemployment rate held steady at 4.2%. The healthcare sector led the growth by adding 62,000 jobs, followed by bars and restaurants with 30,000 new positions.

However, the federal government saw a significant decline, losing 22,000 jobs, marking the largest drop since November 2020. This decline is largely attributed to the job cuts initiated by the Department of Government Efficiency (DOGE), led by billionaire Elon Musk, who has overseen mass layoffs and hiring freezes across federal agencies.

“The federal government has seen a profound shift in its workforce,” said Larry Kudlow on Fox Business. “Private payrolls are outpacing government job numbers, indicating a shift in the economy.”

Job growth has decelerated significantly this year. Employers added an average of fewer than 124,000 jobs per month in 2025, a notable decrease from last year’s average of 168,000. Concerns grow as experts warn that Trump’s tariffs and immigration policies may negatively impact employment in the long run.

“The job market is slowing down; any signs of weakness in upcoming reports could raise fears of a recession,” noted Claudia Sahm, former Fed economist.

Despite the slower job growth, experts like Seema Shah suggest that the labor market remains relatively solid, for now. “While challenges exist, the economy has shown surprising resilience,” she stated.

The continuing economic data will reveal more about the long-term impacts of current policies and hiring trends as the year progresses.