WASHINGTON (Reuters) – U.S. employment growth slowed further in August and permanent job losses increased as money from the government started running out, raising doubts on the sustainability of the economy’s recovery from the deep COVID-19 recession.
Nearly a fifth of the job gains reported by the Labor Department on Friday were from the government’s temporary hiring for the 2020 Census. While the unemployment rate fell below 10%, it was biased down by a continuing misclassification problem.
The slowdown pressures the White House and Congress to restart stalled negotiations for another fiscal package and is likely to become political ammunition for both Democrats and Republicans with just two months to go until the presidential election.
“The labor market has entered a frustratingly slower second phase of the recovery,” said Lydia Boussour, a senior U.S. economist at Oxford Economics in New York. “With one in two laid-off workers still unemployed and