Disappointing August jobs numbers intensified the economic uncertainty caused by the Delta variant, putting pressure on the Federal Reserve as it considers when to reduce its policy support and on the White House as it tries to get more Americans vaccinated.
Fed officials and President Biden had been looking for continued improvement in the job market, but the Labor Department reported on Friday that employers added just 235,000 jobs in August — far fewer than projected and a sign that the ongoing coronavirus surge may be slowing hiring.
“There’s no question that the Delta variant is why today’s job report isn’t stronger,” Mr. Biden said in remarks at the White House. “I know people were looking, and I was hoping, for a higher number.”
A one-month slowdown is probably not enough to upend the Fed’s policy plans, but it does inject a dose of caution. It also will ramp up scrutiny of upcoming data as the central bank debates when to take its first steps toward a more normal policy setting by slowing purchases of government-backed bonds.
speech last week that as of the central bank’s July meeting, he and most of his colleagues thought they could start reducing the pace of asset purchases this year if the economy performed as they expected.
sharp pullback in hotel and restaurant hiring, which tends to be particularly sensitive to virus outbreaks. The participation rate, a closely watched metric that gauges what share of the population is working or looking, stagnated.
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But there were other signs that underlying demand for workers remained strong. Wages continued to rise briskly, suggesting that employers were still paying up to lure people into work. Over the last three months, job gains have averaged 750,000, which is a strong showing. And the unemployment rate continued to decline in spite of the weakness in August, slipping to 5.2 percent.