2026.06.0314:00:00UTC+00U.S. Services Hiring Weakens Further as ISM Non-Manufacturing Employment Index Dips in May

The U.S. services sector showed a slight further cooling in hiring conditions in May, as the ISM Non-Manufacturing Employment Index edged down to 47.9 from 48.0 in April 2026. The latest reading, updated on 3 June 2026, keeps the gauge below the 50-point threshold that separates expansion from contraction, signaling ongoing softness in services employment.

While the decline from April’s 48.0 is marginal, the second consecutive sub-50 reading underscores persistent hiring pressures in the non-manufacturing economy, which includes key segments such as retail, healthcare, finance, and hospitality. The data suggest that employers in the services sector remain cautious about adding to payrolls amid an uncertain economic backdrop.

Investors and policymakers will be watching upcoming labor and activity reports closely to determine whether the weakness in services employment is temporary or part of a more entrenched slowdown in the broader U.S. labor market.