Temporary help services jobs fell by 5,800 in August to approximately 2.68 million, according to data released today by the US Bureau of Labor Statistics. The temp penetration rate edged downward to 1.82% in August from 1.83% in July.

For a full report on US jobs for August, click here.

Looking at all nonfarm jobs, the US added just 235,000 in August for total employment of almost 147.2 million; the total number is still 3.7% lower than the pre-pandemic level set in February 2020 of 152.5 million jobs. So far this year, monthly job growth has averaged 586,000.

“The disappointing headline job numbers illustrate that for the foreseeable future, the overall economy and the labor market will continue to be driven by the state of the pandemic,” said SIA President Barry Asin. “We believe that the outlook for staffing and contingent work remains positive as organizations seek ways to respond to changing worker preferences and the need for greater workforce flexibility.”

August’s gain — the smallest since January — comes with heightened fears of the pandemic and the potential impact of  Covid cases on what has been a mostly robust recovery, CNBC reported. Economists surveyed by Dow Jones had been looking for 720,000 new hires.

“Today’s jobs report reflected the effects of both the Covid-19 Delta variant and the severe labor shortage in the US labor market,” The Conference Board stated. The unemployment rate continued to fall, and there were no signs that the severe labor shortage is easing. Wages are still increasing very rapidly.

Looking forward, the ongoing increase in the number of new infections is likely to lead to another subpar payrolls print in September, according to The Conference Board. Looking toward the end of the year, however, “these severe labor shortages are likely to ease as enhanced unemployment benefits expire and schools reopen, leading more workers to return to the labor market.”

With revisions, employment in June and July combined is 134,000 higher than previously reported.

“Uncertainty about the acceleration of the delta variant and how this might impact the opening of schools and childcare facilities is one of the major reasons we are seeing candidates pause or stop their job search in August, according to our research,” said Karen Fichuk, CEO, Randstad North America and Randstad nv executive board member. “The labor market is still down 1.5 million working mothers since the start of the pandemic and there is a growing urgency to encourage women to re-enter the workforce to address the talent gap.”

Notable job gains in August occurred in professional and business services, transportation and warehousing, private education, manufacturing, and other services. Employment in retail trade declined over the month; leisure and hospitality jobs were flat during the month after leading the way for much of the year.

Employment in professional and business services increased by 74,000 in August; however, since February 2020, employment in professional and business services is down by 468,000, more than half of which, 262,000, is in temporary help services.

Average hourly earnings for all employees on private nonfarm payrolls increased for the fifth consecutive month, rising by 17 cents to $30.73 in August.

More information is available in the full SIA US jobs report.