The recovery of the labor market will continue to be difficult

US sets another record for jobs available in July 0:59

(CNN) -

This Friday's employment report will shed some light on whether the disappointing numbers for August were just a bump, or the beginning of an unwanted trend.

In any case, the recovery could be difficult until the United States completely wears the COVID-19 crisis.

"The pandemic has always been in the driver's seat of this recovery," said Nela Richardson, ADP's chief economist, during a call with reporters on Wednesday.

"The name of the job recovery game remains 'uneven'".

Last year, the job market was quite fragile, and during the colder months, the battered leisure and hospitality sector lost jobs, something that could happen again this year.

Meanwhile, hundreds of thousands of women left the workforce in September 2020, as children returned to virtual classrooms and parents had to become teaching assistants.

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It remains to be seen if any of these phenomena reappear.

Economists surveyed by Refinitiv forecast that half a million jobs were added to the economy last month, revised up from previous estimates of 473,000 additional jobs.

The unemployment rate is expected to fall to 5.1%, just a hair below the August rate of 5.2%.

This would more than double the disappointing 235,000 jobs added in the August report, which beat expectations by roughly half a million.

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ADP's employment report, a different tally of private sector jobs, showed 568,000 jobs added in September, more than economists expected.

The ADP figures and the official government tally are uncorrelated, but last month both reports far exceeded forecasts.

Although the month of September is better than expected in terms of employment, the recovery continues on a rocky path.

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The widespread shortage of workers has been a difficult point for the recovery, as many workers stayed home due to concerns about childcare, exposure to viruses and waiting for better job opportunities.

"Although employment improved from August ... initial claims for unemployment insurance have increased in recent weeks," Richardson said.

"The leisure and hospitality sector was the fastest growing sector again. ... However, companies are still struggling to find workers."

Last week, 326,000 Americans filed for unemployment benefits, adjusted for seasonal changes.

It was less than economists had anticipated, as well as a decrease from the previous week.

That said, weekly benefit claims are still above their pandemic-era low of September 4.

Without seasonal adjustments, 258,909 applications were filed last week.

The government-enhanced unemployment benefits expired in early September.

Economists aren't sure to what extent the generous pandemic benefits contributed to the worker shortage.

Friday's report could offer some evidence one way or the other.

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"The report will likely reflect a mix of hiring constraints related to Hurricane Ida and the reopening of schools and daycare centers, as well as seasonal adjustments within the education sector that may dampen the top line estimate," said the chief economist. by RSM Joe Brusuelas, in a note.

The Federal Reserve will closely monitor the data on Friday.

The central bank has indicated that it will soon withdraw its massive stimulus program due to the pandemic.

Some of the central bank policy makers still want to see more progress in the labor market, but Fed Chairman Jerome Powell said last month that he did not need to see a "shocking" report.

The Bureau of Labor Statistics will release the September employment report this Friday at 8:30 am Miami time.

Jobs in the United States