The May Jobs Report Is Two Reports. One of Them Is About You.
The May numbers were two reports. Only one of them is good news.
by Lawrence Winnerman
The Building
At 6:50 this morning, on a 206-acre cut of Caldwell County scrubland the permits call Project Snow, a twenty-six-year-old clipped into a scissor lift and began pulling cable through the steel skeleton of a building the public will never be allowed inside. The address is 1395 Bob White Road, outside Lockhart, thirty miles south of Austin. Two data centers, 380,000 square feet each, four hundred million dollars between them, broke ground this month. They will not power on until the fall of 2027. He is paid very well to wire them.
A thousand miles north, in Indianapolis, the Salesforce administrator from last month’s roll call is awake too, refreshing a job board that has not changed since Tuesday. She is, in a way she will never be told, the reason the building exists. She will never see it.
He is wiring the machine that will run the software that finishes the job of replacing her.
They will never meet. In a heavy-overtime year he will clear something close to $150,000—more than the administrator ever made at the peak of a fourteen-year career, and he is twenty-six with no degree. But strip out the overtime and the per diem, the part of the check that disappears the day the roof goes on, and his base is roughly what hers was. The same four hundred million dollars lifts one of them and prices the other out of her profession. The difference between them is not the number. It is that he is at the beginning and she is at the end.
If this is your first one—and for about a thousand of you it is—there was a tanker in the last installment, still offloading crude in the Houston Ship Channel, oil pumped before a war that had already moved the price. That tanker was the last cargo of the country we used to be. This building is the first structure of the one we are becoming.
One building. Two labor markets. One clock.
The rest of this essay is about the clock.
The Two Reports
The May jobs report was good news, and the good news was real. Employers added 172,000 jobs—more than double the 80,000 economists expected. Unemployment held at 4.3 percent. March and April were revised up by a combined 93,000. Wages rose 3.4 percent over the year. The anchors said resilient. The president’s account said booming. Every word of it can be defended, and that is exactly what makes it dangerous.
But if you read the report again, slower, and with an eye for details about where the jobs are coming from, it’s different.
Leisure and hospitality: up 70,000, with restaurants and bars alone accounting for 48,000 of it—five times the sector’s normal month, a spike some economists already suspect is World Cup hiring arriving ahead of the tournament. Local government: up 55,000. Health care: up 35,000, most of it home health and ambulatory care. Carry the plate. Open the school. Turn the patient. These are the jobs that cannot be done from a server farm and cannot be done by a model, and in May they were holding the headline up almost by themselves.
Now the other column. Financial activities lost 22,000 jobs in May and is down 107,000 from its peak a year ago. White-collar payrolls—the professional, managerial, information-economy work the administrator in Indianapolis spent fourteen years building toward—have now contracted for thirty-one straight months.
That’s a recession. We are in a white-collar recession right now, and once again, only the AI datacenter building boom is hiding the truth.
Aaron Terrazas, the former Glassdoor economist who first counted the streak, says there is no precedent for it outside a recession going back seventy or eighty years; a white-collar sector shrinking while the overall economy keeps growing had never happened in the eighty-seven-year history of the data. The sectors that hire college graduates added an average of 49,000 jobs a month in the decade through early 2023. Since then they have been shedding 19,000 a month. Indeed’s economists put it plainest: exactly half of the economy’s sectors have lost jobs over the past year. The headline is the average of the two halves.
One report describes people serving the economy. The other describes people being removed from it. They were printed on the same page, under the same number, and only one of them made the air.
On June 9, Axios looked at all of it and ran the sentence this entire essay exists to take apart: “White-collar jobs are under pressure, but the labor market is fine.”
The labor market is fine the way a fever patient is fine—if you only take the temperature in the one place that isn’t hot.
The Door
Here is the number that should have led every broadcast, and didn’t lead even one: 3.2 percent. That is the hiring rate—the share of jobs that are actually filled in a month, not posted, filled. It is among the lowest in thirteen years, a level the economy last saw around 2013, when unemployment was close to 7.5 percent, nearly twice what it is now. Think about what that means: the door into work is as narrow as it was in the wreckage of the last recession. The only reason the line outside it looks shorter is that fewer people are being moved through it in either direction—fired or hired.
And then, two weeks before the May report, the objection arrived right on schedule. In April, job openings jumped to 7.6 million, the biggest one-month rise since 2021, and almost all of it—668,000 postings—came from exactly the professional and business services that have been bleeding for two and a half years. The headline wrote itself: White-collar hiring is back.
It isn’t.
