State labor market conditions remained mixed in May, with payrolls expanding in many states while job losses were concentrated in a smaller group of states and the District of Columbia (D.C.). Construction employment also continued to grow nationwide, although performance varied considerably across states.
In May, nonfarm payroll employment increased in 38 states compared to April, while 12 states and D.C. recorded declines. According to the Bureau of Labor Statistics, total U.S. nonfarm payroll employment rose by 172,000 jobs in May, following an increase of 179,000 jobs in April.
On a month-over-month basis, employment gains were led by Texas (+17,800), followed by North Carolina (+17,400), and New York (+13,700). In contrast, the 12 states and D.C. that recorded losses collectively shed 27,100 jobs, with Virginia posting the largest decline (-8,000). In percentage terms, West Virginia recorded the strongest increase (+1.4%), while Montana experienced the largest decrease (-0.5%) between April and May.
Over the 12 months ending in May, total nonfarm employment increased by 503,000 jobs nationwide, representing a 0.3% gain relative to May 2025. Job gains ranged from 100 in Colorado to 102,900 in California. Collectively, 19 states and D.C. lost 209,400 jobs over the past 12 months, with Virginia recording the largest decline (-52,200).
In percentage terms, job growth ranged from 0.1% in Florida, Washington, and Missouri to 1.8% in Nevada. Colorado, Illinois, and Wisconsin reported no change during the past 12 months. Among states experiencing employment declines, losses ranged from 0.1% in Massachusetts, Vermont, New Jersey, Oklahoma, and Delaware to 1.2% in Virginia. D.C., however, recorded a substantially larger decline of 5.3%.
Construction Employment
Construction employment 1—which includes both residential and non-residential construction, posted gains in May. Twenty-three states and D.C. added construction jobs compared to April, while 22 states lost jobs; five states reported no change. Texas recorded the largest monthly gain (+3,600), while Massachusetts recorded the largest loss (-4,200). Overall, the construction sector added a net 17,000 jobs nationwide in May. In percentage terms, Idaho recorded the strongest monthly increase (+2.6%), while Montana experienced the steepest decline (-4.9%).
Year-over-year, construction employment increased by 68,000 jobs nationwide, a 0.8% gain compared to May 2025. Texas led all states with an increase of 18,700 construction jobs, while California recorded the largest loss (-13,100). In percentage terms, Wisconsin posted the strongest annual growth in construction employment (+6.2%), while New Mexico experienced the largest decline (-3.1%).
State Unemployment Rate
The state unemployment rate is a key indicator of labor market conditions, measuring the share of the labor force that is actively seeking work but unable to find employment. Higher unemployment rates generally signal weaker economic conditions, while lower rates indicate tighter labor markets that may contribute to upward wage pressures.
South Dakota recorded the nation’s lowest unemployment rate at 2.1%, while D.C. posted the highest rate at 6.1%. The elevated unemployment rate in D.C. reflects significant federal workforce reductions and layoffs that occurred during 2025. North Dakota, Hawaii, and Vermont also reported unemployment rates below 3.0%. Meanwhile, Michigan, Connecticut, Delaware, Illinois, Washington, Oregon, Nevada, and California recorded unemployment rates of 5.0% or higher.