The US economy added 661,000 jobs in September, suggesting the labor market’s recovery from the coronavirus pandemic is beginning to plateau amid fading government relief money and a gradually growing virus caseload.
The Labor Department’s payroll report released Friday is the last before the Nov. 3 presidential election, for which the coronavirus pandemic and the subsequent economic recession have been a major issue.
It showed the unemployment rate unexpectedly fell to 7.9% from 8.4%.
Economists surveyed by Refinitiv expected the report to show that unemployment dropped to 8.2% and the economy added 850,000 jobs.
It’s well below the combined 7.5 million jobs added in May and June before hiring cooled in July, with the growth of 1.9 million positions, and in August, with 1.4 million created. There are still roughly 10.7 million more out-of-work Americans than there were in February before the pandemic hit, according to the report.
“These data are consistent with a labor market that is rebounding, albeit at a slower pace than a few months ago, which should be enough to support consumers and consumption,” said Sameer Samana, senior global market strategist at Wells Fargo. “While risks remain, such as election and COVID-19-related uncertainty, we believe investors should continue to remain fully invested.”
Markets continued to slide following the report, with stocks poised for a lower open amid news that President Trump and First Lady Melania Trump tested positive for the coronavirus.
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Leisure and hospitality, one of the industries hit hardest by the pandemic, once again led in terms of job growth, with gains of 318,000. Retail added 142,000, and health care and social assistance rose by 108,000.
Professional and business services increased by 89,000 and the transportation and warehousing sector grew by 74,000. Manufacturing added 66,000 and financial activities rose by 37,000.
Several large employers have recently warned of, or implemented, job cuts.
Disney laid off 28,000 workers, mostly at its two U.S. theme parks. United and American Airlines sent furlough notices to 32,000 employees on Wednesday after federal COVID aid expired, and Royal Dutch Shell said it planned to cut between 7,000 and 9,000 jobs by the end of 2022.