A stronger-than-expected U.S. employment report is reinforcing signs that the labour market remains resilient despite higher oil prices and ongoing inflation concerns. Broad-based hiring across multiple sectors suggests economic activity is stabilizing after a period of uncertainty.
BNN Bloomberg spoke with Ian Wyatt, chief economist at Huntington Commercial Bank, about the implications of May’s jobs data, the impact of rising gasoline prices on consumers, and why the Federal Reserve is unlikely to rush toward interest-rate cuts.
Key Takeaways
- U.S. employers added 172,000 jobs in May, far exceeding expectations and reflecting broader hiring across sectors than seen in recent months.
- Recent labour and economic data suggest the U.S. economy is stabilizing, with job openings, durable goods orders and hiring indicators showing improvement.
- Data centre-related investment continues to drive significant growth in construction and manufacturing, although economic activity remains concentrated in a narrow group of industries.
- Higher gasoline prices are putting some pressure on household budgets, but the overall impact remains manageable relative to other major expenses such as housing.
- Strong employment growth and inflation above target make it difficult to justify near-term Federal Reserve rate cuts, while some policymakers are increasingly discussing the possibility of higher rates.
Read the full transcript below:
LINDSAY: U.S. jobs data remains unchanged for May, so what does that mean in light of rising oil prices? Here to provide in-depth analysis is Ian Wyatt, chief economist at Huntington Commercial Bank. It’s great to have you join us. Appreciate your time this morning.
IAN: Thank you for having me, Lindsay.
LINDSAY: So, 172,000 jobs added in the month of May in the U.S. Were these numbers in line with your expectations?
IAN: Our expectations were 100, so we were a little higher than an estimate, but the estimate was 88, so we really — this was a double, this was a massive beat, honestly, on the jobs numbers. And what’s interesting too, is it was fairly broad-based job growth. We saw a number of sectors adding jobs, not just the few that we’ve really been relying on for growth in recent months.
LINDSAY: I wonder what that tells you, then. Is there an underlying story here about the economy in the U.S., or is it still volatile? Should we be taking these numbers with a grain of salt?
IAN: I would say, versus six — if you compare us, you know, where we were six months ago to today, there really was a period where we were expecting, like, look, we’re up and down every month. It’s pretty small. We’re going to start hitting the point where year-on-year job growth gets too close to zero. Now, the last three, four months, we’ve really had pretty good numbers, several numbers over 100. You saw the revisions were significant this time. It really does seem like the labour market’s firming up. If we look at the turnover survey, you saw openings jumped, so a little bit better openings overall. Turnover is still low, but it’s not getting worse in terms of the hiring rate. And, you know, we had things like durable goods orders come in strong this week too. So, this fits a bigger picture of a solidifying and stabilizing U.S. economy.
LINDSAY: Right. And when it comes to unemployment rate, that was pretty flat, labour force participation. What’s driving those forces there?
IAN: Yeah, I mean it’s something where we’re seeing even the unemployed rate dip slightly too. So, I mean underemployed, so that means people who are part time but want full-time work, for example. So, we are seeing generally a stronger labour market. It was interesting, though, if you break it down at a sector level, you do see oil showing up in a few sectors that jump in oil prices. You know, where do we see drops? We saw airlines, department stores, furniture, some transportation. Those were the weak spots, definitely oil related. Where we saw strength was things like construction, but construction, if you go down into the details, it’s very data centre heavy. It really is just specialty trade contractors, manufacturing picking up a bit. One other good sign in terms of overall employment, as we saw federal employment was flat. It was up 1,000 month on month, and that’s really been a big drag on the economy, you know, with the DOGE cuts and everything else there in terms of overall employment growth. So, if we get federal flat and you have other sectors really firing pretty strongly, that gets overall growth to a better place. And we’re seeing a little bit like temporary help services picked up ever so slightly, and that’s a good bellwether in terms of future outlook. We’ve had some softness for a while, and temp help — seeing temp help do a little better, that was good to see. Metals was really a big driver, weirdly, fabricated metals, another driver, but a lot of that’s the data centre story. Data centres are driving so much of this activity.
LINDSAY: Obviously, I don’t want to tell you gasoline prices are up. I wonder how that’s affecting household spending, how that’s impacting businesses moving forward, and whether that really plays into the jobs numbers that we’re seeing today.
IAN: Yeah, so we have already seen some data that we think lower- and middle-income households have cut back on driving just a tad. We’ve even seen something today that mass transit systems are seeing a little stronger ridership, so you’re seeing a little bit of a response in households. But overall, if you look at it and you do the math, everyone focuses so much on gasoline spend, but the reality is for 80 per cent of Americans, gasoline spend makes up about four per cent of their overall spending. Well, it did last year when gasoline prices were low. This year we think that gets to about five per cent, so that’s only about a one per cent bump. That’s really actually a little less than the bump people got from the tax bill this year in terms of their personal income. And, you know, when we talk about inflationary pressures, it’s funny, I don’t remember people talking about this nearly as much when rents were going up really quickly a few years ago. And the reality is rents, in those cases, for a lot of households, you know, you’re north of a third of their budget. There’s, I think, about a quarter of households where it’s 50 per cent of their take-home spend goes to rent. So, inflation there is a lot more painful, and this is more manageable. But it also is, when I mentioned things like where did we expect to see consumers pulling back, consumers do tend to pull back a little when they’re spending more on gasoline. It would be things like department stores, furniture stores. Maybe they’re going to trade down, and even at the grocery store, if you look at the historical research, they’ll do a lot of, you know, beef to chicken, that kind of substitution factor happening, going to generics more.
LINDSAY: Yeah, I know you touched on this in the beginning, but do you think these numbers are going to affect Fed rates in any meaningful way moving forward?
IAN: Yeah, I totally agree with our first guest. I don’t see a case for cutting right now. I think at the beginning of this year, honestly, we thought there was enough softness in the labour market. There still is. The lack of hiring really is hurting new college grads. We are still seeing a lot of new college grads struggling to find jobs. But overall, it’s a pretty good labour market, and you have inflation above target. You have these things kind of coming together where it’s really hard to make a case for cuts right now. And obviously the market’s starting to price in a hike. I don’t think we’re quite there yet in terms of our forecast, that we’re going to quite get to a hike this year, but we do see a Fed — and you see it in the messaging, you saw it in the three dissents last time that all wanted a statement that was more balanced — that this is a more neutral Fed, and we certainly have to price in the possibility of hikes this year.
LINDSAY: Okay, we’ll have to leave it there. Ian Wyatt, chief economist at Huntington Commercial Bank, really great to get your insight. Thanks for joining us.
IAN: Thank you, Lindsay. Appreciate having me.
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This BNN Bloomberg summary and transcript of the June 5, 2026 interview with Ian Wyatt are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
