US Labor Market Snapshot — May 2026

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The Indeed Hiring Lab monthly snapshot of the US labor market summarizes where key indicators — job postings, wages, unemployment, and openings — stand as of May 2026 and flags the trends worth watching in the months ahead.

The Big Picture

Overall hiring demand has essentially returned to where it stood in early 2020, with Indeed job postings roughly even with the immediate pre-pandemic baseline. That may sound ominous, but the pre-pandemic job market was generally strong and balanced. Even so, despite a strong payroll report in May, this is still a low-hire, low-fire market, and the labor data have yet to point to gathering momentum. 

Job Postings

Where we are: Indeed’s JPI stood just 0.4% above pre-pandemic levels (at 100.4) as of May 31, 2026. This is back in line with the trough seen last fall, throwing a bit of a wet blanket on early-year momentum in labor demand.

Direction of travel: Monthly growth in the JPI trended positive at the turn of the year, but readings slipped over each of the past three months, sliding 2.2% in May. Year-over-year change (-4.8%) also remains negative.

Line graph titled "Job postings return close to pre-pandemic levels" showing the indexed level of US job postings on Indeed, where 100 equals the February 1, 2020 baseline, through May 31, 2026. Postings surged to roughly 160 in early 2022 and have steadily declined since, bumping along just above the pre-pandemic baseline at 100.4 as of late May 2026.
Line graph titled “Job postings return close to pre-pandemic levels” showing the indexed level of US job postings on Indeed, where 100 equals the February 1, 2020 baseline, through May 31, 2026. Postings surged to roughly 160 in early 2022 and have steadily declined since, bumping along just above the pre-pandemic baseline at 100.4 as of late May 2026.

Wages

Headline: Posted wage growth held at 2.4% year-over-year in May. Beneath the trend deceleration in overall posted wage growth, an interesting dynamic is emerging in “wage tiers.” Similar to the surge in posted pay for “low-wage” occupations as the economy reopened from the pandemic, low-wage jobs are once again seeing faster growth in posted wages (2.7%) than their higher-paying peers.

Line graph titled "Low-wage occupations lead annual posted wage growth again" showing a 3-month moving average of year-over-year growth in the Indeed Wage Tracker by low, middle, and high-wage occupation groupings. Traditionally lower-paying jobs saw the largest wage bumps in the immediate reopening from the pandemic and are once again outpacing higher-paying job groups.
Line graph titled “Low-wage occupations lead annual posted wage growth again” showing a 3-month moving average of year-over-year growth in the Indeed Wage Tracker by low, middle, and high-wage occupation groupings. Traditionally lower-paying jobs saw the largest wage bumps in the immediate reopening from the pandemic and are once again outpacing higher-paying job groups.

The Labor Market Balance

Unemployment: The unemployment rate stayed steady at 4.3% in May, where it has spent all but one month of this year. Meanwhile, the vacancy-to-unemployment ratio improved to 1.0 in April, indicating one available job vacancy for every unemployed worker. This indicator remains depressed relative to 2018-2019 and is in line with a labor market offering fewer opportunities than a few years ago.

Hires, quits, and layoffs: At 1.9%, the quits rate remains subdued, suggesting workers lack confidence that greener pastures await in new positions. In fact, hires are at a rate last seen during the long and slow recovery from the Great Recession in the early 2010s. Low layoffs remain a bright spot in the labor market, keeping net hiring positive.

Line graph titled "The ratio of openings to unemployment is at parity" showing the number of US job openings per unemployed worker through April 2026. After surging in 2021, it has now returned to 1.0, implying one open job per unemployed worker.
Line graph titled “The ratio of openings to unemployment is at parity” showing the number of US job openings per unemployed worker through April 2026. After surging in 2021, it has now returned to 1.0, implying one open job per unemployed worker.

What We’re Watching

  • Indeed JPI nears early 2020 level: Indeed’s Job Posting Index has been hovering around 100 for the past few weeks, and if recent trends continue, it is likely to drop below 100 soon. Returning to pre-COVID levels of job postings is not inherently concerning, given the strength of the labor market in early 2020, but it is certainly worth watching.
  • Monetary policy and inflation: Headline CPI inflation climbed to 4.2% year-over-year in May (the highest in over three years), driven by gas prices that are 40% higher today relative to a year ago. The recent upswing in inflation has pushed real wage growth into negative territory and threatens consumption ahead. It has also deflated expectations that the Fed will lower interest rates further in 2026.

The full chartbook with additional sector, wage, and JOLTS detail is available here.

Infographic titled "US Labor Market Snapshot: May 2026" presenting key indicators from the Indeed Hiring Lab. The Job Postings Index (JPI) sits at 100.4, down 2.2% month-over-month and 4.8% year-over-year (an improvement from -8.1% in May 2025). Posted wage growth has risen to 2.4% year-over-year, trailing CPI inflation of 4.2%, while the unemployment rate stands at 4.3%, above the 2019 average of 3.7%. Job openings per unemployed worker sit at 1.0, below the 2019 level of roughly 1.2, and AI-related postings have climbed to 5.7%, well past their prior peak of 3.3% in 2022. A bar chart of selected sectors shows Production & Manufacturing (~114) and Healthcare (~110) well above the February 2020 baseline, Loading & Stocking (~107) modestly above, and Human Resources (~91) and Software Development (~72) still below pre-pandemic levels.
Infographic titled “US Labor Market Snapshot: May 2026” presenting key indicators from the Indeed Hiring Lab.

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