Steady hiring, fewer layoffs

June 9, 2026

Temps de lecture: 3 mins

May’s jobs report showed a labor market that is improving, with payroll growth exceeding expectations and layoffs down sharply from last year. Steady hiring and fewer layoffs should continue to support consumer spending and U.S. economic growth.

Agrandir

Last week’s jobs report showed that the U.S. labor market remains more resilient than expected. Nonfarm payrolls rose by 172,000 in May, well above consensus expectations for 88,000. Upward revisions to the prior two months also suggest hiring momentum has been firmer than initially reported, reinforcing the view that labor demand has held up despite ongoing geopolitical uncertainty.

So far, the labor market is better than last year. Year-to-date payroll gains total 569,000, compared with 182,000 over the same period in 2025. Layoffs have also moved in a more constructive direction. Year-to-date layoffs stand at 398,000, down sharply from 696,000 at this point last year.

Looking ahead, job growth is likely to settle into a more moderate range due to aging demographics and lower immigration. Still, as long as hiring continues and layoffs remain contained, consumer spending, the backbone of the U.S. economy, should remain positive.

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Resilient through uncertainty

U.S. policy uncertainty has remained elevated and consumer sentiment has weakened. Even so, the economy has stayed resilient, and because growth has held up better than sentiment and headlines suggest, we continue to forecast 2% U.S. growth in 2026, in line with trend.

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Getting real in retail

Despite persistent concerns that sticky inflation would erode purchasing power and drag consumer spending lower, the May retail sales data tells a different story. Spending is up not just in dollar terms, but in quantity, highlighting continued consumer resilience.

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Higher inflation, contained expectations

Inflation has jumped since the Strait of Hormuz closed, squeezing consumers through higher gas and utility bills and pressuring businesses with higher freight and operating costs. Yet, longer-term inflation expectations remain contained, suggesting this looks more like a temporary energy shock than a lasting inflation upswing.

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A broader foundation for earnings growth

Although companies benefiting most directly from AI-related capital spending are the main drivers of higher earnings, strength is no longer confined to that group. Earnings across the broader market remain solid and are expected to grow more than 10% this year and next, suggesting the risk of concentrated market leadership may not be founded.