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Current Unemployment Rate and Other Jobs Report Findings
The current unemployment rate is 4.2%.
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Anna Helhoski is a senior writer covering economic news and trends in consumer finance at NerdWallet. She cohosts and produces Money News segments of NerdWallet's Smart Money podcast. She is also an authority on student loans. She joined NerdWallet in 2014. Her work has been syndicated in news outlets nationwide including The Associated Press, The New York Times, The Washington Post and USA Today. She previously covered local news in the New York metro area for the Daily Voice and New York state politics for The Legislative Gazette. She holds a bachelor's degree in journalism from Purchase College, State University of New York.
Laura McMullen assigns and edits financial news content. She was previously a senior writer at NerdWallet and covered saving, making and budgeting money; she also contributed to the "Millennial Money" column for The Associated Press. Before joining NerdWallet in 2015, Laura worked for U.S. News & World Report, where she wrote and edited content related to careers, wellness and education and also contributed to the company's rankings projects. Before working at U.S. News & World Report, Laura interned at Vice Media and studied journalism, history and Arabic at Ohio University. Laura lives in Washington, D.C.
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Updated on June 10.
Initial jobless claims went up for the week ending May 31, according to the report released on June 5.
Why it matters: The weekly jobless claims, or initial claims, are the number of unemployment insurance claims filed in the past week. They provide an indicator of the strength — or weakness — of the labor market.
Learn more about this week's jobless claims
Jobless claims were 247,000 for the week ending May 31, an increase of 8,000 compared to the previous week’s revised figure of 226,000.
The new four-week moving average — a measurement of the number of people who filed for unemployment insurance for the first time over the last four weeks — was 235,000, an increase of 4,500 from the previous week’s revised average of 230,500.
What's the insured unemployment rate?
Not all types of unemployment are included as part of the insured unemployment rate. It only includes "covered unemployment," as in people who receive unemployment benefits. Those who quit their jobs, for example, aren't included in the insured unemployment rate because they aren't eligible for unemployment benefits.
The advance seasonally adjusted insured unemployment rate — the rate of continuous covered unemployment claims divided by covered employment — ticked down to 1.2% for the week ending May 24, compared to the previous week’s unrevised rate of 1.3%.
The unemployment rate held steady at 4.2% in May, compared to April, according to the jobs report released on June 6 by the Bureau of Labor Statistics (BLS).
Here are some other takeaways from the report:
Job gains came in above projections for May with a total of 139,000. The consensus estimated monthly expectation was a 125,000 increase, according to Morningstar, an investing firm.
Employment went up in health care, leisure and hospitality and social assistance sectors.
For the fourth month in a row, employment went down in the federal government due to the recent mass federal workforce cuts by the so-called Department of Government Efficiency (DOGE). Employees on paid leave or receiving severance are considered employed, which means the full effect of the cuts are yet to be reflected in the report.
Average hourly earnings of all private nonfarm employee payrolls rose by 3.9% over the past 12 months from $34.89 per hour to $36.24 per hour in May 2025.
What the latest job market data means for you
The labor market is solid, as reflected by modest wage and higher-than-expected employment, but momentum has cooled compared to previous years.
Wage growth remains above inflation growth, which means consumers are more likely to weather price increases — that is, unless there are price shocks. The effect of tariffs on prices haven’t fully set in so it’s unclear how that might impact inflation growth.
There are some vulnerabilities in the job market continuing to trend including layoffs in sectors like retail and wholesale, as well as a reduction to the previous month’s job gains numbers.
For now, workers should temper their optimism with caution as there is still much uncertainty in the broader economy.
What a NerdWallet expert says
Elizabeth Renter, economist at NerdWallet, says the jobs report shows continued cooling in the labor market, but it’s not “fully on-ice.”
“Fewer jobs are being added, hiring continues to slow and workers aren’t quitting their jobs with expectations of finding another quickly. This hard data continues to confirm what we’ve heard from consumer sentiment (“soft”) data about the labor market — that there are fewer jobs available, and that folks are less optimistic about their ability to hold onto their current role. That said, the unemployment rate remains steady and layoffs aren’t climbing.”
The current unemployment rate is 4.2% for May, unchanged from April. The rate is higher than unemployment rates during 2023 and 2024.
How the unemployment rate is calculated
The unemployment rate is calculated by dividing the number of unemployed people by the number of people in the labor force. (The labor force is considered the sum of those who are currently working or looking for work.) The result is then multiplied by 100 to get a percentage:
Number of unemployed people / Labor force x 100 = X%, which is the unemployment rate
Is unemployment rising or falling?
The unemployment rate has risen since hitting a 50-year low of 3.4% in April 2023. Since May 2024, the unemployment rate has stayed between 4% and 4.2%.
The unemployment rate went up by 0.1 percentage point in January, February and March, but was unchanged in April.
Will unemployment go up soon?
The recent rise in unemployment was a byproduct of monetary policymakers’ effort to curb inflation by hiking interest rates. The Federal Reserve raised the federal funds rate 11 times between March 2022 and July 2023. Now that inflation is consistently slowing, the Fed has taken steps to prevent unemployment from rising further.
The Fed cut rates at its September, November and December meetings. It paused rates at its January, March and May meetings, but has indicated that there could be some rate cuts in 2025.
Wage growth is moderating from what it was a year ago but is still higher than it was pre-pandemic, according to data from the Federal Reserve Bank of Atlanta. The three-month moving average of median hourly wage growth — when measured over the previous 12 months — has slowed from its peak in the summer of 2022.
For March, the three-month wage growth percent change was 4.3%, which is the same as February’s three-month moving average rate.
The 12-month moving average for all workers — part-time and full-time — was 4.6%, the same as February. By comparison, the percent change for March 2024 from a year prior was 5.2%. If you look back even further, at the percent change for March 2020 from a year prior, the rate was 3.7%.
Increases in compensation costs in the first quarter of 2025 were the same as the fourth quarter of 2024, according to the most recent quarterly BLS Employment Cost Index, which measures wage and salary growth. Wages and salaries, as well as benefits comprise total compensation costs.
The April 30 report shows compensation costs increased by 0.9% in the first quarter of 2025.
Year-over-year measurements show that compensation cost increases slowed in Q1 2025 (3.6%), compared to the previous four quarters:
Q4 2024: 3.8%
Q3 2024: 3.9%
Q2 2024: 4%
Q1 2024: 3.8%
For the 12-month period ending in March 2025, wages and salaries had a slower increase (3.5%) compared with the 12-month period ending in March 2024 (4.4%).
Benefit costs had a slightly higher increase in the 12-month period ending in March (3.8%) compared to March 2024 (3.7%).
Below, the Federal Reserve Bank of Atlanta data for March shows a steady decline in the three-month moving average of wage growth compared to the peak in June 2022 and July 2022.
More key jobs data and what it means
How many jobs were added in May?
The economy added 139,000 (nonfarm) jobs in May, according to the BLS. The report says that May’s gains are aligned with the average monthly gain of 149,000 over the previous 12 months.
147,000 in April 2025.
120,000 in March 2025
102,000 in February 2025.
111,000 in January 2025.
323,000 in December 2024.
261,000 in November 2024
159,068 in October 2024
159,025 in September 2024
158,770 in August 2024
144,000 in July 2024
118,000 in June 2024
216,000 in May 2024
What is the labor force participation rate?
The labor force participation rate went up slightly at 62.6% in April compared to 62.5% in March after annual adjustments, according to the Bureau of Labor Statistics.
Why it matters: The labor force participation rate is the percentage of the population that is working or looking for work.
The rate is calculated as the labor force divided by the total population that’s eligible to work. (The Bureau of Labor Statistics defines the total population that’s eligible to work as the “civilian noninstitutional population,” which refers to people ages 16 and older who are not in military service or incarcerated.) The result is multiplied by 100 to get a percentage:
Labor force / Civilian noninstitutional population x 100 = X%, which is the labor force participation rate
Since October 2002, the labor force participation rate was lowest in April 2020 (60.1%) and highest in June 2003 (66.5%), according to BLS data.
How many job openings were there in April?
The latest Job Openings and Labor Turnover Summary (JOLTS), released on June 3, shows job openings were 7.4 million in April. The number of openings is down by 901,000 compared to a year ago, according to the report.
7.2 million in March
7.5 million in February
7.8 million January
7.5 million in December
8 million in November
7.6 million in October
7.1 million in September
7.7 million in August 2024
7.5 million in July 2024
7.4 million in June 2024
7.9 million in May 2024
7.6 million in April 2024
8 million in March 2024
8.4 million in February 2024
The seasonally adjusted job openings ticked up slightly at 4.4% in April from 4.3% in March. By comparison, the job openings rate in April 2024 was 4.6%.
The number of job openings in April went down in accommodation and food services (-135,000) and in state and local government education (-51,000). Job openings went up in arts, entertainment, and recreation (+43,000) and in mining and logging (+10,000).
What is the layoff rate?
The rate of layoffs in April (1.1%) ticked up slightly from March (1%), according to the most recent JOLTS report.
The sectors with the largest increases in layoffs and discharges were health care and social assistance (+52,000). The number of layoffs and discharges went down in state and local government, excluding education (-14,000) and in federal government (-4,000).
What is the quit rate?
The JOLTS report also shows the quit rate in April was 2%, changed slightly from March (2.1%). The current rate is slightly below the quit rate in April 2024 (2.2%).
Why it matters: Economists say quit rates are a key factor in the health of employment prospects since quitting shows that workers feel safe making a job switch within their sector or outside it entirely.
The current quit rate is consistent with pre-pandemic levels after peaking at 3% in both Nov. 2021 and April 2022.
When is the next jobs report?
The next jobs report will show data for May and it will be released on June 6.
(Photo by Spencer Platt/Getty Images News via Getty Images)
