"Even though job growth slowed, it's still well above where it needs to be to keep up with the working-age population growth", said Jed Kolko, chief economist at Indeed, an online recruiting site.
Details of the employment report were weak.
The economy added just 138,000 net new jobs for the month, well below analyst expectations, while the jobless rate decreased by a tenth of a point to 4.3 percent. Employment in food services and drinking places also showed increases of 30,000. Job growth is slowing as the labour market nears full employment.
Average hourly earnings for private-sector workers increased by 0.2 percent from a month earlier in May.
Economists surveyed by Bloomberg had expected an increase of 180,000 in non-farm payrolls, which would have been in line with average monthly gains seen over the past year. There is growing anecdotal evidence of companies struggling to find qualified workers.
The decline in that measure is an encouraging sign that jobless people who had given up hope of working are now being hired.
Even with the figures, economic growth is likely to rebound this quarter and the USA is near full employment, helping explain why Federal Reserve policy makers are expected to raise interest rates when they meet on 13-14 June.
The US central bank raised interest rates by 25 basis points in March. "The lack of more substantial inflation also argues against a future trajectory of aggressive rate hikes".
As oil price comparisons on a year-over-year basis ease this summer, the rate of inflation will increase, leading to an absolute decline in real wages.
However, a litany of factors, such as consumer spending and interest rates, influence hiring decisions. The new jobs were on pace with the 24,600 jobs created in April. The good news is that much of the new job growth can be credited to Donald Trump's active deregulations, as businesses respond to what they perceive as a much more growth-oriented policy and administration. The U-3 headline unemployment rate dropped slightly from 4.4% to 4.3%, which is the lowest it has been since 2001.
The historically low unemployment rate comes with the caveat that the labor force shrank last month.
A rise in overall unemployment in the first quarter of the year, StatsSA said, is a pattern observed annually, usually following a reduction in unemployment in the final three months (Q4) of each year.
Manufacturing employment fell by 1,000 jobs last month as payrolls in the automobile sector dropped 1,500 amid declining sales. Others, like Zandi, say they believe the US has reached full employment, but wage growth is just lagging behind a bit and will pick up in coming months.
But the last 12 months show no clear trend in the participation rate, according to the report.
"The loss of manufacturing jobs in May is a stark reminder of the challenges that face factory workers", Scott Paul, president of the Alliance for American Manufacturing, said in a statement, calling on Trump and Congress to address the United States trade deficit.
But the retail industry has shed 50,000 jobs the past three months as brick-and-mortar stores shutter amid a seismic shift to online shopping.