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US unemployment has hit its lowest level since 2001 but job growth has slowed

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The U.S. economy added only 138,000 new jobs in May, but still managed to push the unemployment rate to its lowest level since 2001, according to the latest jobs report from the Department of Labor

The Labor Department noted that the unemployment rate fell from 4.4. percent to 4.3 percent. 

Since January, the number of unemployed people has decreased by 774,000. But, as Reuters notes, May's job gains mark a deceleration from the 181,000 monthly average over the past year.

As the labor market approaches full employment, job gains have slowed.

Average hourly earnings rose 0.2 percent in May. Over the last 12 months, wage growth has inched up to 2.5 percent. Some economists hope that reaching full employment will spur faster wage growth.

Meanwhile, Reuters reports, the Federal Reserve in its Beige Book suggested there's evidence companies are struggling to fill roles with qualified workers.

The report was overall met with mixed reviews.

That said, the underemployment rate dropped to 8.4 percent in May. The U6 is seen as a broader measure of employment since it includes people who work part-time that are looking for full-time work, as well as those who aren't actively looking, but could work.

"Even though job growth slowed, it’s still well above where it needs to be to keep up with the working-age population growth," Indeed's Jed Kolko told the New York Times. The Federal Reserve will likely see the drop in unemployment as a signal to continue raising interest rates this year.

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