The Washington PostDemocracy Dies in Darkness

U.S. economy added 194,000 jobs in September, another weak month heading into final stretch of 2021

The U.S. economy added just 194,000 jobs in September, a disappointing month that reflects how severely the delta variant is hampering the country’s recovery. (Patrick T. Fallon/AFP/Getty Images)

The United States added just 194,000 jobs in September, the Labor Department reported Friday, disappointing results that raised fresh concerns about the economic recovery as the delta variant and lagging vaccination rates exacerbated long-standing labor market woes.

The tally, well below the 500,000 that analysts had forecast, is the lowest since January and comes after months of strong jobs growth petered out in August. Though it was enough to slice the unemployment rate to 4.8 percent, vs. 5.2 percent in August, the decline is partly due to a large number of people — primarily women — leaving the labor force.

The pandemic’s toll on the labor market is no longer a new phenomenon, and the public and political appetite for addressing it appears to be waning, after Congress allowed unemployment benefits to expire for at least 6 million Americans last month.

But the report underscores the continuing strain in certain sectors of the economy, particularly in low-wage work, which has not rebounded the way higher-skilled positions have. The United States has 5 million fewer jobs than it did pre-pandemic, and it needs to gain back an even bigger number for the labor market to fully recover.

And those numbers skew along socioeconomic lines: While Americans 25 and older with college degrees fully recovered from their pandemic job losses by May, Americans in a similar age group without degrees remain 4.6 million jobs below pre-pandemic levels.

September was supposed to be pivotal to the push to gain back those jobs, with widespread coronavirus vaccinations, falling caseloads and the return of normal functions such as in-person schooling to allow the economy to rev back up.

But child care woes, lingering health concerns about the virus and in-person work, and skill, wage and preference mismatches for those looking for jobs continue to throw that recovery into doubt — a unique and evolving set of challenges for policymakers and central bankers.

“Delta turned it on the ear,” Diane Swonk, chief economist at Grant Thornton, said of the recovery. “We’d like it to be that easy. But nothing has been easy in the pandemic. The challenges are still substantial to getting people back.”

Economists said they saw some hopeful signs that the September report, taken from a survey done midmonth, was the product of an unfortunate series of crises that would not be replicated in future reports.

The nation’s coronavirus caseload, powered by the virulence of the delta strain and large pockets of vaccine resistance, closed in on its late-summer peak, averaging about 150,000 cases a day. Hurricane Ida had just pummeled the Mid-Atlantic and Northeast, leading to widespread school and business closures. Wildfires in California sent smoke billowing across the mainland.

So the great return to work for those who are unemployed or stopped looking for work entirely never materialized. More people actually left the labor force last month — primarily women, whose numbers plunged by 300,000 as 182,000 men joined.

Millions of people have left the labor force since the pandemic began, and many of them cite child care as among the primary causes.

Sara Wojtala, 31, a mother of two in the Detroit area, hasn’t worked since the earliest days of the pandemic, after losing her $21-an-hour job as an emergency dispatcher.

She tried to bounce back with some work in real estate but found that her skills weren’t suited to the industry. Now, as the caretaker of 2- and 5-year-old boys, she said she hasn’t found a position yet that would make it economically feasible for her to return to work and pay for child care. Recruiters keep calling her with jobs offering $14 or $15 an hour.

“As much as I want to be able to go back to work, it’s not financially possible,” she said. “They’re not going to pay me enough to make it worthwhile.”

On top of that, she said, she’s still concerned about the family’s health, with the coronavirus still at high levels.

She and her husband, who is training to be a windmill technician, plan to sell their house to raise money, buy an RV and live an itinerant lifestyle, as long as its conducive to his work.

America’s unemployed are sending a message: They’ll go back to work when they feel safe – and well-compensated

The hiring in September was complicated by the picture in schools, where with employment declined by 161,000 in state and local government education. That is due in part to seasonal adjustments made by the statisticians who compile the report that are based on pre-pandemic hiring trends, like school staffing surges in September, economists said.

The sluggish trends may also be a reflection of the toll that labor shortages, particularly among support staff like cafeteria workers and bus drivers, have taken as schools scramble to fill jobs for the new academic year.

Swonk and other economists said that Hurricane Ida also probably had a dampening effect on September’s report.

That was one reason Joe Brusuelas, chief economist at the firm RSM, said he thought the report was better than it looked at a first glance.

“What I see is Hurricane Ida delayed reopening of schools and day-care centers, contributing to the weaker-than-anticipated total change,” he said.

With stimulus payments and additional unemployment, some workers are reassessing when and how they’ll get back to work as the economy emerges from crisis. (Video: Mahlia Posey/The Washington Post)

The cessation of unemployment benefits for millions of Americans early in the month did little to stimulate hiring, undercutting a key argument that has occupied the political debate in Washington.

“We’ve always been in the camp that that was more of a political statement than good economic policy,” Brusuelas said in reference to the ending of unemployment benefits.

The United States has a record number of job openings — nearly 11 million, according to the most recent statistics from late July — with employers ranging from food service to hotels to trucking companies reporting difficulty hiring.

There is some anecdotal evidence that workers are less willing to take on low-paying, unrewarding work — particularly if pandemic complexities like health concerns or child care worries are still an issue.

Then there are people like Jason Dunne, 43, who lost his job during the pandemic and hasn’t been able to find comparable work since.

The Roswell, N.M., resident had been a medical technician — installing alert devices in the homes of mostly elderly clients all over the state. He said it felt like the perfect job: He set his own schedule, made a decent income of $60,000 to $70,000 a year, and enjoyed the work, saying his upbringing with his grandparents made relating to elderly people come naturally to him. But after a year of steadily declining work, he lost the job in February.

He took a position doing roadside assistance for a big company afterward but said it was so dysfunctional — the computer system would go down 12 to 15 times a day — and paid, at $13 an hour, less than half of what he made before — that he left.

He’s been scanning jobs sites like Monster and Indeed for months but hasn’t had much luck. “They’re either [low-wage jobs] or they’re hiring for doctors or nurses. Or truck drivers,” he said.

He’s currently doing gig work for companies like DoorDash and Grubhub, which he said has stabilized his finances while he looks for longer-term options. Dunne said he gets frustrated whenever he hears pundits or politicians insinuating that workers should just take the first job that comes at them, as Fox Nation host David Webb recently did on Twitter.

“You work so hard to find your position,” Dunne said. “I traveled all over the county, I was a lead tech. I’m not about to just go start stocking shelves or being a cashier again. I don’t think I could handle it. I did that in my youth, and I worked so hard to get beyond that, to get something where I could have a little more freedom.”

Average wages continued to rise, to $30.85 for workers at private companies — up about 4 percent from a year ago — a point emphasized by President Biden on Friday.

“Right now, things in Washington — as you all know — are awfully noisy,” he said. “When you take a step back and look at what’s happening, we’re actually making real progress.”

Biden joined other Democrats, like House Speaker Nancy Pelosi, in saying the jobs report highlighted the need to approve his spending packages, including improving U.S. infrastructure and early education.

There were other signs of the drag the delta variant was having on the economy in September.

Weekly unemployment claims rose for three straight weeks, before falling last week. And restaurant reservations, which according to data from online reservation service Open Table had begun returning to pre-pandemic levels, took a dive.

Those trends seemed to be reflected in the report. Bars and restaurants added just 29,000 jobs; hotels about 2,000. The modest gains in the leisure and hospitality sector were instead largely driven by hiring in arts, entertainment and recreation.

Professional and business services, like architectural and engineering services, technical consulting services and computer systems design added 60,000 jobs for the month. Retail added 56,000 jobs, particularly in clothing and merchandise stores, and at building and garden supply outposts. Transportation and warehousing continued its growth — increasing by 47,000 jobs, making it notable as one of the sectors that has more jobs now than it did before the pandemic.

Manufacturing added 26,000 jobs, despite a decline of 6,000 in auto manufacturing that economists say is due to supply chain issues that are unlikely to be resolved soon.

Andrew Van Dam, Heather Long and Jeff Stein contributed to this report.