The U.S. economy added a disappointing 38,000 jobs in May, according to economists who had predicted jobs increasing by about 160,000 last month. 

May saw the weakest monthly job gains since September 2010, the Labor Department announced Friday. The number of jobs created in March and April was also revised, decreasing by a total of 59,000.

The unemployment rate, meanwhile, dropped to the lowest level since November 2007, decreasing from 5 percent in April to 4.7 percent in May. The unemployment rate fell partly because more people left the labor force. 

Labor participation ticked down from 62.8 percent in April to 62.6 percent last month.

Wages, however, saw a boost in May. There was a 5-cent increase in average hourly earnings last month, bringing the figure to $25.59. Wages have increased 2.5 percent from one year ago.

Elise Gould, senior economist at the Economic Policy Institute, released the following statement on the new jobs report:

This morning's jobs report showed that the economy added a disappointing 38,000 jobs in May. While this number is depressed by the 35,000 Verizon workers who were striking during the reference period, even adding those workers back into the mix, the total number of jobs is low compared to recent trends. It's true that as the labor market tightens we should see the number of jobs created each month fall, however this month's dismal number is not even strong enough to more than keep up with population growth.

Not surprisingly, the overall and prime-age labor force participation rates fell, while wage growth held steady at 2.5 percent. As the labor market tightens we should see wage growth rise, however it's clear that we are not at a level consistent with full employment. With wage growth this low, there is simply no threat of wage-led inflation. The Fed should bear this in mind when it meets later this month and not be too quick to raise rates and slow the economy.