Chart Shows Winning and Losing Industries, per the Latest Jobs Report

The Bureau of Labor Statistics (BLS) released its May jobs report on Friday, revealing gains in the hospitality, government, and healthcare sectors, while showing losses in a handful of other industries.

According to the BLS, the U.S. economy added 172,000 jobs in May, following a 179,000 gain in April-revised up from an initially reported 115,000. Prior to the release, analysts had penciled in an 85,000-job lift, marks the third straight month of better-than-expected readings.

Although overall hiring outpaced market expectations, the unemployment rate, which is 4.3 percent, held relatively steady. This mixed outcome presents a complex landscape for the Trump administration, which is currently navigating economic uncertainty fueled by geopolitical tensions in Iran and shifting domestic policies.

The White House celebrated Friday's findings, but while robust hiring trends may have staved off fears of an imminent labor market slowdown, analysts say this-combined with heightened concerns over inflation-will dissuade policymakers at the Federal Reserve from cutting rates anytime soon.

Where Jobs Are Growing

The leisure and hospitality sector spearheaded May's labor growth, adding 70,000 positions-a figure that outpaces its recent historical trend. According to the BLS, this expansion was primarily driven by restaurants and bars, which contributed nearly 50,000 new jobs.

Public sector employment also experienced a sharp uptick. Government payrolls expanded by 55,000, driven heavily by local government hiring outside of the education sector. This surge represents a notable acceleration following more moderate public-sector gains earlier this year.

Healthcare continued to post steady growth, adding 35,000 jobs, consistent with its average pace over the past year. Ambulatory healthcare services, including home health providers, accounted for the majority of these gains, complemented by steady hiring within hospitals. Additionally, social assistance employment rose by 12,000, driven by sustained demand for individual and family services.

Together, the data reinforced a familiar pattern in the post-pandemic labor market: hiring remains concentrated in service industries tied to consumer demand and aging demographics.

“The favorable top-side employment gain of 172,000 was largely driven by lower paying industries such as local government (non-education) and restaurants with perennial jobs, leader healthcare continuing its strong gains. If you're hoping for better paying industries to add to payrolls, you got some mild relief in several IT industries but most white-collar sectors were neutral, or in the case of banking and insurance, down over 20K,” Ron Hetrick, principal economist at Lightcast, told Newsweek.

Hetrick said that after several months of labor force declines, the U.S. squeezed out an 83,000 increase, with 82 percent coming from Hispanics, mainly Hispanic men.

Industries Losing Jobs

Conversely, the financial sector experienced the most pronounced contraction in May, while hiring across most other major industries stalled.

Employment in financial activities fell by 22,000 jobs, extending a broader downward trajectory. The sector has shed over 100,000 positions since peaking in May 2025, with recent losses heavily concentrated among insurance carriers and commercial banking institutions.

The transportation and warehousing sector remained largely unchanged, though it rests significantly below its 2025 peak. Modest gains in ground transportation and warehousing were offset by losses in air transportation, the latter tied to a recent business closure.

Meanwhile, sectors including construction, manufacturing, retail trade, and professional and business services showed little movement over the month, indicating slower or more cautious hiring outside of key growth areas.

“One thing that is clear, unemployment in manufacturing has been heading down, approaching historical lows. This may be in part due to the removal of asylum seekers, many of whom found work in manufacturing, construction and hospitality,” Hetrick said. “It may also be driven by companies attempting to reshore after tariffs and taking what is left from a shallow labor pool. The market does not look capable of meeting many more needs in that sector."

What Does the Latest Jobs Report Signal About the U.S. Economy?

The latest figures suggest the labor market is holding steady, but with signs of growing divergence beneath the headline numbers.

Strong hiring in services-particularly in leisure, healthcare, and local government-continues to offset weakness in areas such as finance, while other major industries show little momentum in either direction.

For policymakers and economists, the trend underscores a key question heading into the second half of the year: whether job growth can broaden out across the economy or remain concentrated in a handful of sectors.

2026 NEWSWEEK DIGITAL LLC.

This story was originally published June 5, 2026 at 2:35 PM.