The U.S. economy added 374,000 private jobs in August, according to ADP and Moody’s Analytics in their monthly labour report released Wednesday, little more than half of what economists expected.
While the August was an increase over the 326,000 private jobs for June, the report said. Most experts projected about 600,000 jobs.
“Our data, which represents all workers on a company’s payroll, has highlighted a downshift in the labor market recovery,” ADP Chief Economist Nela Richardson said in a statement.
“We have seen a decline in new hires, following significant job growth from the first half of the year.”
Wednesday’s assessment said the rise in COVID-19 cases has had an impact on the job market.
“Despite the slowdown, job gains are approaching 4 million this year, yet still 7 million jobs short of pre-COVID-19 levels. Service providers continue to lead growth, although the Delta variant creates uncertainty for this sector. Job gains across company sizes grew in lockstep, with small businesses trailing a bit more than usual,” Richardson added.
According to the research, 86,000 new employment were created in small enterprises, 149,000 in medium-sized businesses, and 138,000 in large businesses. The majority of the new employment generated last month, around 200,000, were in leisure and hospitality.
Concerns over the Delta coronavirus type, according to Moody’s Chief Economist Mark Zandi, have “dented” the market’s recovery for the time being.
“Job growth remains strong, but at a slower rate than in recent months,” he said. “Job growth remains inexorably linked to the pandemic’s progress.”
On Friday, the Labor Department will release its August jobs report.