The U.S. economy added 194,000 jobs, below the consensus call of 500,000 and Argus’ forecast of 300,000. The report is a sign that the nation’s health — reflecting the spread of the Delta variant over the summer — continues to have negative impact on the economic recovery. In better news, the unemployment rate dropped four-tenths of a percent to 4.8%; and the change in total nonfarm payroll employment for August was revised up by 131,000, from 235,000 to 366,000. All told, nonfarm employment has risen by 17 million since April 2020 but is down by 5.7 million, or 3.2%, from its pre-pandemic level in February 2020. In September, job gains occurred in leisure and hospitality, professional and business services, and retail. Fewer teachers were hired in September, which likely had a one-time impact on the final count. We expect to see a bigger impact on hiring from the declining number of COVID-19 cases (the seven-day average is now 100k compared to 150k a month ago) and anticipate an improvement in hiring trends heading into the holiday season.