- U.S. economy adds 235,000 jobs in August against 720,000 forecasted
- Leisure and hospitality hiring, which had been leading job growth this year, abruptly falters amid rising COVID-19 cases
- Hiring strongest in professional and business services as well as transportation and warehousing
Summary by Dirk Langeveld
Hiring in August fell well short of expectations, according to data from the Bureau of Labor Statistics. The increase in COVID-19 cases due to the Delta variant likely played a major part in this slowdown, with the leisure and hospitality sector seeing an abrupt drop in hiring after leading jobs growth earlier in the year.
The U.S. economy added 235,000 nonfarm jobs in August, a major slowdown from the upwardly revised figures of 1.1 million jobs added in July and 962,000 in June. Dow Jones economists had forecasted that 720,000 new jobs would be created, though the payroll services company ADP came up with the similarly diminished tally of 374,000 earlier this week for its private sector payrolls report for August.
While the leisure and hospitality sector has led the recovery in jobs, averaging 350,000 new positions a month this year, hiring was flat in August and jobs at food services and drinking establishments were down by 42,000. The sector is still down by 10 percent, or 1.7 million jobs, compared to pre-pandemic figures.
- 17 million jobs have been recovered since April 2020, but the nation is still down 5.3 million jobs (3.5 percent) from pre-pandemic levels
- Economists say the spike in COVID-19 cases due to the Delta variant has been slowing economic growth and making consumers more cautious in their spending and job searches
- Professional and business services had the strongest job growth in August, adding 74,000 positions
- Hiring was up by 53,000 in transportation and warehousing, 40,000 in private education, and 37,000 in both manufacturing and other services
- Retail jobs were down by 29,000
- Average hourly earnings increased 17 cents to $30.73, while the average work week remained at 34.7 hours
- The unemployment rate fell 0.2 points to 5.2 percent, with 8.4 million people classified as unemployed