WASHINGTON — U.S. employers added just 194,000 jobs in September, a second straight tepid gain and evidence that the pandemic still has a grip on the economy with many companies struggling to fill millions of open jobs.

Friday’s report from the Labor Department also showed that the unemployment rate fell sharply to 4.8% from 5.2% in August.

The economy is showing some signs of emerging from the drag of the delta variant of the coronavirus, with confirmed new COVID-19 infections declining, restaurant traffic picking up slightly and consumers eager to spend.

But new infections remained high as September began, and employers are still struggling to find workers because many people who lost jobs in the pandemic have yet to start looking again. Supply chain bottlenecks have also worsened, slowing factories, restraining homebuilders and emptying some store shelves.

President Joe Biden on Friday still pointed to signs of overall progress in the economy and the nation's fight against the pandemic, despite the modest report.

"In total, job creation in the first eight months of my administration is nearly 5 million jobs," he said. "Jobs up, wages up, unemployment down. That's progress. And it's a tribute to the hard work and resilience of the American people who are battling through this pandemic.

"Maybe it doesn't appear dramatic enough," he added. "We're making consistent, steady progress."

Speaking to Spectrum News Friday, Labor Secretary Marty Walsh acknowledged the “mixed messaging” of the September jobs report. 

“You know … I don't want to use the word ‘mixed messaging’ in the report, but it was kind of inconsistent in some ways,” he said.

The U.S. did see gains in manufacturing and retail, Walsh noted. And the leisure and hospitality industry added 74,000 jobs in September – a number that he suggested could be higher if not for the continued spread of delta, which continues to ravage many parts of the U.S.

“(When) we did the survey, there was definitely direct correlation to the delta variant that kept people from going back into that industry,” Walsh said Friday. “So we're still living with the pandemic here.”’

Many economists still think that most of the roughly 3 million people who lost jobs and stopped looking for work since the pandemic struck will resume their searches as COVID wanes. It took years after the 2008-09 recession, they note, for the proportion of people working or seeking work to return to pre-recession levels. The government doesn’t count people as unemployed unless they’re actively looking for jobs.

Some of the factors that have kept many jobless people on the sidelines may be starting to ease. According to a survey by the Census Bureau, for example, the number of people who aren’t working because they must stay home to care for a child declined by half in September compared with June. That figure had barely dropped last fall, when many schools remained closed and conducted virtual learning. The new census figures suggest that more parents, particularly mothers, might have rejoined the workforce last month as the school year began and their children returned to school.

In addition, an August survey by the job listings website Indeed found that the proportion of unemployed Americans who said they’d like to find a job once the school year began had more than doubled from just two months earlier.

Yet there are also signs that it might be too soon to expect a flood of parents to have rejoined the labor market. Lael Brainard, a member of the Fed’s Board of Governors, noted in a recent speech that COVID-19 outbreaks in late September caused 2,000 schools to close for an average of six days in 39 states.

Several enhanced unemployment benefits ended in early September, including a $300-a-week federal supplement as well as programs that, for the first time, covered gig workers and people who were jobless for six months or more. So far, the ending of those programs appears to have had only a small effect on the number of people seeking work.

Governors in about 25 states ended the $300 benefit before the nationwide expiration in September. Research by economists at Goldman Sachs found that unemployed people who were looking for work were much more likely to take jobs when their benefits ended. But the early cut-offs did not cause people on the sidelines to start searching again, Goldman concluded.

“I’ve been saying this for four months: I don't think that that the unemployment benefits were keeping people out of work,” Walsh said. “And certainly, we saw the numbers from when states ended (benefits) a few months ago – we didn't see any gain in job growth. This month, we've ended it here (and) haven't seen any gain in job growth because of that.

“I do think what's happening here is that there's a lot of people looking at their work-life balance,” Walsh added. “I think they're reevaluating their careers – where they are, where they want to be. I think that's part of it.”

Republican lawmakers on Friday were quick to criticize the less-than-stellar report.

"Between paying people more to stay home than work and his unconstitutional vaccine mandates, more Americans are unnecessarily out of the workforce," Sen. Rick Scott, R-Fla., wrote on Twitter. "Biden’s job-killing agenda is bad for American families."

Others pointed to the president's sweeping domestic agenda as another example of something that could hurt the economy, especially since it includes tax increases on wealthier people.

"The cost of virtually everything from a gallon of gasoline to groceries is surging. And now this," wrote Rep. Bill Johnson of Ohio. "Is this @JoeBiden's idea of how to #BuildBackBetter?"

Another reason workers are scarce is a surge in retirements among older, more affluent workers whose home equity and stock portfolios have surged since the pandemic struck and who have managed to build up savings. Goldman Sachs estimates that about 1.5 million people have retired who wouldn’t have before the pandemic upended the economy. Many of these people will likely stay retired, economists expect.

In the meantime, fear of COVID continues to keep some would-be job seekers on the sidelines, notably those who previously worked in public-facing service jobs at restaurants, bars, hotels and retailers.