The American job engine hit the brakes in May. Private employers added just 37,000 jobs — the weakest growth in over two years — as trade wars spooked businesses into freezing hiring. That’s a far cry from the 110,000 economists expected.
Tariffs are being eyed as partly to blame, and markets like Kalshi think there’s an 86% chance President Donald Trump levies (no pun intended) some more.
ADP’s monthly payroll report suggests momentum is fading fast. Manufacturing and other goods-producing sectors actually lost jobs last month.
Trump used the weak numbers to pressure Fed Chair Jerome Powell to cut interest rates, blasting him on Truth Social: “ADP NUMBER OUT!!! ‘Too Late’ Powell must now LOWER THE RATE … Europe has lowered NINE TIMES!” on Truth Social.
Official government figures come Friday, with expectations hovering around 125,000 new jobs. Even if that holds, the signal is clear: hiring is slowing, confidence is cracking, and trade war fallout is taking a toll.
The only silver lining? Layoffs haven’t surged. Yet.
Hiring Slows to a Crawl
Private businesses added just 37,000 jobs in May — the weakest showing in over two years. Economists had forecast 110,000. Instead, the labor market flinched.
Trade Wars Blamed
The slowdown is being chalked up to the global trade wars. Businesses are spooked, and many have put hiring plans on ice.
ADP Rings the Alarm
Payroll processor ADP called it: “Hiring is losing momentum,” said their chief economist. This may be a preview of the official government jobs report due Friday.
BLS Report Up Next
Economists expect the Bureau of Labor Statistics to show 125,000 jobs added in May. But if ADP is right, that may be wishful thinking.
Manufacturing Takes the Hit
The steepest job losses came from goods-producing sectors—manufacturers especially—as imports and exports nosedive.
Trump Demands Action
Trump jumped on the numbers, demanding the Fed slash interest rates: “ADP NUMBER OUT!!! ‘Too Late’ Powell must now LOWER THE RATE!”
Fed Holding the Line
The Federal Reserve isn’t budging yet. It wants to see if the trade wars spike inflation before making a move.
No Layoff Surge — Yet
The good news? Most businesses aren’t firing workers. So far, the slowdown is a freeze, not a freefall.
Easing Tensions (For Now)
The White House has temporarily relaxed some tariffs to allow for more negotiation — a move that may calm markets in the short term.
The Bigger Picture
The labor market isn’t collapsing, but it is wobbling. Slower hiring, shaken confidence, and escalating trade fights are pushing the economy into uncertain territory.
