The most recent jobs report was disappointing. Only 235,000 jobs were created in August 2021, versus an expectation of 720,000. Leisure and hospitality jobs had led the way this year — until August. For the six months before August 2021, those industries had averaged 350,000 new jobs per month. Last month there were no job gains in the sectors. The drop-off in leisure and hospitality resulted in August’s jobs gains being the weakest monthly gain since January 2021.

The weakness was attributed to rising COVID-19 cases. Consumer demand ticked down as the uncertainty regarding new infections went up. U.S. infection cases are up to about 150,000 cases a day. The jobs report saw an increase of about 400,000 people who said they couldn’t work for pandemic-related reasons, bringing the total to 5.6 million. The reluctance of would-be workers confirmed the apprehension of businesses to bring on new employees. Corporations paused hiring as hot, hot, hot economic growth cooled to merely hot.

The Delta variant wave is a caterwauling reminder that the pandemic remains one of the most critical factors driving the economy, if not the single most crucial factor. One other significant factor is that, beginning as early as June 2021, roughly half of U.S. states opted out of taking the federal $300 weekly plus-up for unemployment benefits. Governors of those states argued that businesses were competing against the federal benefits for workers. Those additional federal plus-up benefits were eliminated for every state on Labor Day, September 6, 2021.

The governors hypothesized that by eliminating the additional benefit, people would go back to work. It’s too early to determine if that hypothesis is true or not. However, it is possible that the unintended consequence of denying those people that extra $300 per week resulted in the drop in aggregate demand. It’ll be interesting to look at all the data once enough time has passed in order to measure the fallout correctly. Not that there needs to be computational time; there needs to be enough time to compare periods. However, thus far, economists at JP Morgan and Columbia University have found “zero correlation” between job growth and states’ decisions to opt-out of federal unemployment aid.

We don’t yet honestly know the effect of eliminating those additional $300 weekly payments. If dropping the extra unemployment benefits does fail to pull people back into the workforce, it could create a negative feedback loop. Demand for goods and services will drop, and businesses won’t need to hire as many people. This risk is heightened because, as of September 6, 2021, benefits for self-employed and gig workers (freelancers) were terminated. Also on Labor Day, special consideration was canceled for those unemployed for more than six months. Roughly 8.9 million Americans will lose all or some of these benefits. For comparison, during the Financial Crisis of 2008, jobless benefits of different forms that began in 2008–2009 were extended until 2013. When those benefits ceased, there were 1.3 million people still receiving amped-up aid.

There was some

WASHINGTON (Reuters) – The U.S. economy created the fewest jobs in seven months in August as hiring in the leisure and hospitality sector stalled amid a resurgence in COVID-19 infections, which weighed on demand at restaurants and other food places.

FILE PHOTO: A sign advertising job openings is seen while people walk into the store in New York City, New York, U.S., August 6, 2021. REUTERS/Eduardo Munoz

But other details of the Labor Department’s closely watched employment report on Friday were fairly strong, with the unemployment rate falling to a 17-month low of 5.2% and July job growth revised sharply higher. Wages increased a solid 0.6% and fewer people were experiencing long spells unemployment.

This points to underlying strength in the economy even as growth appears to be slowing in the third quarter because of the soaring infections, driven by the Delta variant of the coronavirus, and relentless shortages of raw materials, which are depressing automobile sales and restocking.

Nonfarm payrolls increased by 235,000 jobs last month, the smallest gain since January. Data for July was revised up to show a whopping 1.053 million jobs created instead of the previously reported 943,000.

That left the level of employment about 5.3 million jobs below its peak in February 2020. Economists polled by Reuters had forecast nonfarm payrolls increasing by 728,000 jobs.

The initial August payrolls print has undershot expectations and been slower than the three-month average job growth through July over the last several years, including in 2020. August payrolls have been subsequently revised higher in 11 of the last 12 years.

Employment in the leisure and hospitality sector was unchanged as restaurants and bars payrolls fell 42,000, offsetting a 36,000 gain in arts, entertainment and recreation jobs. Retailers shed 29,000 jobs.

There were gains in professional and business services, transportation and warehousing, as well as manufacturing, which added 37,000 jobs. Factory hiring remains constrained by input shortages, especially semiconductors, which have depressed motor vehicle production and sales.

Raw material shortages have also made it harder for businesses to replenish inventories. Motor vehicle sales tumbled 10.7% in August, prompting economists at Goldman Sachs and JPMorgan to slash third-quarter GDP growth estimates to as low as a 3.5% annualized rate from as high as 8.25%.

Government payrolls fell in August as state government education lost 21,000 jobs. The Bureau of Labor Statistics, which compiles the employment report cautioned that “recent employment changes are challenging to interpret, as pandemic-related staffing fluctuations in public and private education have distorted the normal seasonal hiring and layoff patterns.”

U.S. stocks opened lower. The dollar slipped against a basket of currencies. U.S. Treasury prices fell.

HOUSEHOLD DETAILS STRONG

Details of the smaller household survey from which the unemployment rate is derived were fairly upbeat.

The unemployment rate fell to 5.2%, the lowest since March 2020 from 5.4% in July. It has, however, been understated by people misclassifying themselves as being “employed but absent from work.” Without this problem, the jobless rate would have been 5.5%.

Though the

A man wearing protective face mask, following an outbreak of the coronavirus disease (COVID-19), walks in front of a stock quotation board outside a brokerage in Tokyo, Japan, March 10, 2020. REUTERS/Stoyan Nenov

HONG KONG, Sept 3 (Reuters) – Asian shares held their gains on Friday while the dollar was at a month low against major peers as traders awaited U.S. employment data with global shares at record highs.

MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) was broadly flat in early trading in Asia having posted gains in eight of the last nine sessions as the benchmark edges back towards its position in mid July before Chinese regulatory crackdowns sent shares tumbling.

Japan’s Nikkei (.N225) rose 0.38%, and MSCI’s all-country world index (.MIWD00000PUS) edged higher having ended the previous session at its fifth consecutive closing high.

Australia (.AXJO) was up 0.3% and Korea rose 0.61% while Chinese blue chips (.CSI300) fell 0.27% and Hong Kong (.HSI) dropped 0.6% right after the bell, as traders try to balance weaker economic data out of China against the potential for future stimulus.

Investors anticipate that Beijing will accelerate fiscal spending and credit growth as its economic recovery slows, but that such measures will be finely targeted as the U.S. Federal Reserve prepares to taper its own stimulus. read more

Traders are hoping to get a better sense of the timing and pace of U.S. tapering on Friday after U.S. non-farm payroll data is published later in the day, as Fed Chair Jerome Powell has suggested an improvement in the employment numbers is the remaining major prerequisite for action.

According to a Reuters survey of economists, non-farm payrolls likely increased by 750,000 jobs last month after rising by 943,000 in July.

“When it comes to tapering the focus is now the labour market. If we’re in the area of 750,000 the expectation will be for a September tapering announcement,” said Stefan Hofer, chief investment strategist at LGT private bank in Asia.

Hofer said he was focused on leisure and hospitality jobs as they were a good indicator of the state of the recovery from the COVID-19 pandemic.

U.S. treasuries have been cautious ahead of the data release, and in Asian hours on Friday the yield on benchmark 10-year Treasury notes was 1.2919% compared with its U.S. close of 1.294% on Thursday.

The dollar stayed pinned at month lows against a basket of currencies , with the euro doing a fair amount of the work.

The European single currency touched its highest level since early August against the greenback on Friday, as markets start to react to the potential for more sustained eurozone inflation and reduced stimulus from the European Central Bank.

“The persistence of the increase in input inflation will provide more substance to arguments that the ECB should soon start to dial back its asset purchases,” analysts at ANZ said.

Oil prices fell in early Asian hours having risen by more than $1 a barrel on Thursday.

U.S. crude dipped 0.36%

Workers taking up gigs at bars, restaurants and hotels are a mainstay of the pandemic job market’s healing.

Why it matters: Since the industry shed the most workers when COVID-19 hit, it has the most room to recover.

  • It’s also been a proxy for the state of America’s reopening — and the hurdles that come along with it, like worker shortages.

By the numbers: For yet another month, the sector delivered the bulk (+380,000) of job gains, with two-thirds of that hiring happening at restaurants and bars.

The big picture: Leisure and hospitality has added a whopping 2.1 million payrolls since the beginning of the year — a big chunk of the total 4 million the economy has gained since then.

  • The sector has 1.7 million fewer jobs than when the pandemic hit.
Data: Bureau of Labor Statistics via FRED; Chart: Axios Visuals

A big part of the comeback story: bosses raising pay like mad to lure the staff they need to meet reopening demand.

  • Wages rose another 1.4% on a monthly basis for non-managers in the sector. (Compare that to the overall 0.4% gain for employees.)

What to watch: How much the sector remains at the pandemic’s mercy — with the presence of vaccines — as infections surge.

  • “The risk is new mask mandates and other COVID restrictions weaken the pace of recovery as returning to the office stalls and caution starts to creep back in,” ING economist James Knightley says.

WASHINGTON, Aug 23 (Reuters) – New U.S. state-level data and accompanying studies show a group of largely Republican governors did not yet get the job boom they hoped for by cutting federal unemployment benefits this summer, but the loss of the stipend did appear to prompt some of the unemployed to take jobs.

Underlying that topline conclusion, however, is also evidence of a more nuanced reshuffling among different employment categories that could have bearing on the economy’s performance in the critical months to come.

Separate analyses released last week, using different data sets and methods, concluded that the 26 states that cut a $300 weekly federal unemployment stipend this summer did see the unemployed find a job at a faster rate, perhaps as much as 6 percentage points, than did the 24 states planning to continue the benefit at least until its scheduled national expiration in early September.

However, the states that cut benefits saw worse results in pulling people back into the formal labor force, to the degree that overall job growth in the two groups of states was nearly identical from May through July. In the U.S. government’s regular employment surveys, people are considered unemployed only if they are looking for a job; others are considered out of the labor force until they start a job or begin a job search.

While the end of federal supplemental unemployment benefits may have motivated people to take jobs in the one group of states, “in non-cutoff states employment rose almost as much by bringing people back into the labor force,” meaning people who had not been looking for work at all in the previous month had started a search and found a job, wrote Jed Kolko, chief economist for job site Indeed.

Goldman Sachs economists reached a similar conclusion.

Though neither offered a comprehensive explanation for why that difference may have emerged between the two groups of states, the finding could spell trouble for continued job gains this fall if coronavirus cases continue to surge. Federal Reserve officials and others expect robust employment gains in the coming months as schools reopen, daily life edges back to normal – and the extra federal unemployment benefits expire nationally.

Arguments about the continued need for the benefits, pressed most pointedly by Republican state leaders, emerged in the spring as national coronavirus case rates collapsed amid the first rounds of COVID-19 vaccinations, job openings soared, and employers complained they had trouble getting people to come back to work.

The Goldman Sachs study noted that the cut in benefits appeared to have its biggest impact on lower-paid workers in the leisure and hospitality industry – an intuitive finding since the weekly federal benefit represents a higher proportion of the pay they would receive from returning to work.

Yet those jobs are also the most susceptible if the surge in the virus changes people’s willingness to participate in “close contact” services.

At the same time, Goldman noted that its findings “suggest” those who left the labor

Last month, the economy showed signs of solid job growth, adding 943,000 jobs to the labor force in July, according to the Bureau of Labor Statistics. This brings the overall unemployment rate down to 5.4%, lower than the 5.7% rate economists had predicted.

Of the 943,000 jobs added, 68.8% went to women, marking the largest one-month increase in women’s job growth since August 2020, reports the National Women’s Law Center. With women disproportionately impacted by the Covid-19 pandemic, the NWLC estimates that women need nearly five straight months of July’s job gains to return to where they were before the pandemic.

“I think this was a blockbuster month, having nearly one million jobs added,” Jasmine Tucker, NWLC’s director of research, tells CNBC Make It. While it’s good to “celebrate all those gains,” Tucker says she’s unsure about whether we will see similar growth in the coming months due to mask mandates and other restrictions being reinstated because of the delta variant.

“I think next month we could see something completely different based on what’s happening right now,” she says, while emphasizing that “it will be interesting to see what happens with parents” as the school year starts back up.

When looking at the overall jobs report for July, women accounted for 53.9% of the job gains in the leisure and hospitality industry, 91.3% of the job gains in government and all of the job gains in the education and health services sector, according to NWLC’s analysis.

“So, there’s sort of a mixed bag there,” says Tucker. “We tend to think of government jobs as more well-paid jobs with benefits. But, when you think about leisure and hospitality, I think a lot of those are low-quality jobs where people don’t have access to great scheduling, the wages are lower and they don’t always have access to benefits.”

While leisure and hospitality jobs — including those in restaurants, hotels and other service sectors — tend to help drive the economy, data indicates that workers in these roles could also be impacted the most if restrictions are reinstated that limit dining out, traveling and leisure activities.

When peeling back the layers of the jobs report, Tucker says you will also see that not all workers are having an equal recovery. While a total of 140,000 men and women rejoined the labor force last month, NWLC reports that 65,000 Black women and 51,000 Latinas left in July.

“We saw a lot of the unemployment numbers come down, which I think signals some good signs as people have come back to the labor force,” explains Tucker. “But for Black women and Latinas, whose unemployment rates also went down, they had large numbers of people leaving the labor force and that’s probably what drove their [unemployment] drop because those people are no longer counted among the unemployed since they aren’t looking for work.”

In July, the overall unemployment rate for women ages 20 and over decreased to 5% from 5.5% in June. The overall unemployment

California’s unemployment held steady in June as the state continues to recover from pandemic losses, though the pace of adding jobs has slowed as workers take their time rejoining the labor force.

After four consecutive months of adding over 100,000 jobs per month, June saw gains of 73,500 jobs, state officials reported Friday. The state’s jobless rate stayed flat at 7.7%, as an expanded labor force offset job gains. The state’s Employment Development Department revised the May unemployment figure to 7.7%, from 7.9%.

The problem has shifted from a weakness in worker demand to one of supply.

Economist Lynn Reaser

The latest jobs numbers still underscore the economy’s continued recovery after the state dropped COVID-19 restrictions on businesses starting June 15, and as people venture out more into restaurants and theme parks and travel picks up.

California typically added between 15,000 and 25,000 jobs each month, before the onset of the pandemic in the spring of 2020.

The state had 16.42 million jobs as of June. Eight of 11 industry sectors added jobs last month, led by leisure and hospitality, which added 44,000 new jobs. For the last five months, that sector has been the fastest-growing industry in the state, thanks to restaurants rehiring and tourism ramping up.

The construction industry lost the most jobs in June, but some economists said this is likely a temporary blip on the road to recovery, not a trend. The sector lost 3,000 jobs, largely building foundation and exterior contractors, according to the EDD.

Economists said the recovery now hinges more on filling jobs rather than creating them. Workers seem slower to return to the job market than in previous recessions, as the state’s active labor pool is still below its pre-pandemic level.

“California’s job engine made further progress in June, but the problem has shifted from a weakness in worker demand to one of supply,” said Lynn Reaser, an economist at Point Loma Nazarene University in San Diego.

Los Angeles County followed similar trends. Total employment increased by 28,700 to 4,209,900, and leisure and hospitality jobs led the gains, adding 14,300 jobs.

In June, the county still had one of the highest unemployment rates in the state, at 10.6%, down from a revised 10.7% in May.

Ben Wheatley, head rigger with Bahia Marine, goes below deck aboard a 67' sailboat in Alamitos Bay Marina.

Ben Wheatley, head rigger with Bahia Marine, goes below deck aboard a 67′ sailboat in Alamitos Bay Marina. Wheatley hasn’t really had time off since the pandemic begun.

(Allen J. Schaben/Los Angeles Times)

Nancy Wheatley, manager of Bahia Marine Inc., a sailboat rigging and marine hardware store in Huntington Beach, has been struggling to fill an entry-level job since April. The position is for an assistant to a master rigger — someone mechanically-minded to help a boat specialist on jobs, no experience necessary.

“Normally it’s not hard to get people to walk through the door with an application,” said Wheatley, who typically fills these jobs in a couple of weeks. Her son Ben, the company’s master rigger, has had to do the jobs alone in the

Houma-Thibodaux gained 900 jobs in May and is up 4,000 compared to a year earlier, a new report shows.

The yearly gain, however, results not from any major growth in the local economy but because May 2020 was one of the worst for job losses due to the COVID-19 pandemic. Specifically, it was the first full month of state restrictions on social gatherings and business aimed at curbing the virus’s spread.

As a result, Houma-Thibodaux’s May 2020 unemployment rate skyrocketed to 11.2%.

The metro area, comprised of Terrebonne and Lafourche parishes, posted a 5.6% jobless rate in May, no change from April, according to a report released last week by the Louisiana Workforce Commission.

Houma-Thibodaux economy:Houma-Thibodaux area businesses grapple with labor shortage

The number of people working in the two parishes combined is still down by just under 1,000 compared to before the pandemic, state figures show. In May, 83,616 people held jobs locally compared with 84,614 in February 2020.

But the number of people unemployed and looking for work in May across the two parishes, 4,952, is about half of what it was a year ago.

The number of people working in Terrebonne and Lafourche parishes combined is still down by just under 1,000 compared to before the pandemic, state figures show.

A forecast released in May by the University of Louisiana-Lafayette’s business school says it will likely take well into next year for the state to recover the jobs lost during the pandemic. Houma-Thibodaux and Lafayette could take longer because of weak activity in the Gulf of Mexico oilfield, which fuels both economies. And both areas were just beginning to recover from a six-year oil bust when the pandemic hit.

Loren Scott, a well-known Louisiana economist, offered a similar prediction in his annual forecast last fall. After years of losses, Houma-Thibodaux will gain 3,200 jobs over the next two years, Scott said. But that will still leave the local economy 1,300 jobs below where it was before the COVID-19 pandemic. And most of the gains are jobs coming back online as the pandemic ebbs, not newly created business activity.

Offshore wind energy:Bill would send coastal states revenue from offshore wind energy

Here are other local trends from the latest Workforce Commission report. The figures are not adjusted for seasonal variations.

► Local jobs directly involved in oil and gas exploration and production, 5,000 in May, are up by 100 for the month and year. The gain ends 25 straight months of year-to-year losses in the category.

► Oilfield-service jobs, at 4,100, also rose by 100 for the month and year.

► Local shipbuilding and maritime jobs, now totaling 3,800, are down 100 for the month and 500, or 12%, from May 2020.

► A category labeled “administrative and support services,” which includes mostly oil-related jobs, totaled 3,000 in May, no change for the month and up 200 compared to a year earlier.

► Jobs in leisure and hospitality, a category that includes restaurants, bars and hotels, totaled 7,800 in May, no change for the month. The category has regained 1,500 jobs, up 24%, since May 2020.

► The area’s civilian labor

The pace of U.S. hiring accelerated in June, with payrolls gaining the most in 10 months, suggesting firms are having greater success recruiting workers to keep pace with the economy’s reopening.

Nonfarm payrolls increased by 850,000 last month, bolstered by strong job gains in leisure and hospitality, a Labor Department report showed Friday. The unemployment rate edged up to 5.9% because more people voluntarily left their jobs and the number of job seekers rose.

The median estimate in a Bloomberg survey of economists was for a 720,000 rise in June payrolls.

“Things are picking up,” said Nick Bunker, an economist at the job-search company Indeed. “While labor supply may not be as responsive as some employers might like, they are adding jobs at an increasing rate.”

Demand for labor remains robust as employers strive to keep pace with a firming economy, fueled by the lifting of restrictions on business and social activity, mass vaccinations and trillions of dollars in federal relief.

At the same time, a limited supply of labor continues to beleaguer employers, with the number of Americans on payrolls still well below pre-pandemic levels.

Coronavirus concerns, child care responsibilities and expanded unemployment benefits are all likely contributing to the record number of unfilled positions. Those factors should abate in the coming months though, supporting future hiring.

Wage growth is also picking up as businesses raise pay to attract candidates. The June jobs report showed a hefty 2.3% month-over-month increase in nonsupervisory workers’ average hourly earnings in the leisure and hospitality industry. Overall average earnings rose 0.3% last month.

The gain in payrolls, while well above expectations, doesn’t markedly raise pressure on the Federal Reserve to pare monetary policy support for the economy. Even with the latest advance, U.S. payrolls are still 6.76 million below their pre-pandemic level.

For the Biden administration, the report offers some relief after prior months showed disappointing job gains.

The Labor Department’s figures showed a 343,000 increase in leisure and hospitality payrolls, a sector that’s taking longer to recover because of the pandemic.

Job growth last month was also bolstered by a 188,000 gain in government payrolls. State and local government education employment rose about 230,000, boosted by seasonal adjustments to offset the typical declines seen at the end of the school year.

Hiring was relatively broad-based in June, including other notable gains in business services and retail trade. Construction payrolls dropped for a third straight month and manufacturing employment rose less than forecast.

“Most of the new jobs now being created are in sectors that were slammed by the pandemic, while companies in other industries are struggling to find available workers,” Sal Guatieri, senior economist at BMO Capital Markets, said in a note.

The overall participation rate held steady and remained well short of pre-pandemic levels. The employment population ratio, or the share of the population that’s currently working, was also unchanged.

Other data in the report showed:

  • Average weekly hours decreased to 34.7 hours from 34.8.
  • The participation rate for women age
  • The US added 850,000 nonfarm payrolls in June.
  • Leisure and hospitality added 343,000 jobs, the most of any major industry sector.
  • The construction and financial activities industries both saw another month of job losses.
  • See more stories on Insider’s business page.

June was another month of large employment gains for the leisure and hospitality industry. 

The US added 850,000 nonfarm payrolls in June according to the latest release from the Bureau of Labor Statistics. This gain was above the median estimate from economists surveyed by Bloomberg. 

Leisure and hospitality, which was one of the hardest hit industries from the pandemic, made up a large portion of the gains with 343,000 jobs added in June. This means the industry made up 40% of job gains last month.

Job gains last month varied by major industry, as seen in the chart below. Construction and financial activities both lost jobs in June, employment in utilities was unchanged, and every other major industry saw some gain in employment.  

Government followed behind leisure and hospitality with 188,000 jobs added last month. Heidi Shierholz, senior economist at the Economic Policy Institute, wrote on Twitter specifically about state and local government job gains, which added 193,000 jobs together.

Shierholz wrote it is “crucial” that these governments “use their ARP funds to refill those jobs” because there are still around 1 million fewer state and local government jobs in June than before the pandemic.

Many of the government job gains last month were in education. There were 155,000 jobs added in local government education and 75,000 in state government education.

However, it is important to note that those gains could be partly due to the way the Bureau of Labor Statistics adjusts data for seasonal patterns in the coronavirus pandemic. BLS wrote in the latest release that “Without the typical seasonal employment increases earlier, there were fewer layoffs at the end of the school year, resulting in job gains after seasonal adjustment.”

Transportation and warehousing saw the smallest monthly gain in June among the major industries. The industry added 10,700 jobs last month but is 93,600, or 1.6%, below pre-pandemic employment.    

Construction did not see as large as a decline in June as it did in May. In May, Construction shed 22,000 jobs. However, construction is still 3.1% below pre-pandemic employment. Within construction, construction of building did see an increase of 5,600 jobs, while heavy and civil engineering construction lost 10,900 jobs.

“I think that’s something to keep an eye on in the months ahead as we see what’s going on with the housing market and how that passes through to the labor market in the form of jobs in the construction sector,” Bunker told Insider.