Job growth sputtered in August with the overall number added falling sharply below expectations. In the Department of Labor’s data update, the U.S. economy’s newly added non-farm payroll jobs hit 235,000 versus the 720,000 forecasted by Dow Jones, according to CNBC.

The report showed job growth has averaged 586,000 positions monthly. The number of jobs added in July was 1.1 million and for June it was 962,000, illuminating just how poor the showing was for August.

Unemployment inched slightly downward from 5.4% to 5.2% as the U.S. is moving closer to pre-pandemic lows.

Why hiring slowed so dramatically in August remains an open question. The number of jobs estimated to be currently open is close to 10 million, yet employers are frequently complaining that they are unable to find people to fill these roles. In a recent survey, U.S. chief financial officers lamented that hiring has proven more difficult than before with 95% of CFOs surveyed sharing this view.

The immediate reason why hiring has stagnated may have to do with the COVID-19 Delta variant. Infections and hospitalizations have skyrocketed from Delta, but company executives said that the virus did not alter their outlooks much. Federal Reserve officials also stated in recent weeks that they saw COVID-19 as continuing to be a challenge, but believed the economy was adjusting to it.

Unemployment assistance is another often-cited reason for restrained hiring. Proponents of this argument, including many Republican governors of large states, believe the federal unemployment benefits discouraged people from returning to work. Some states have cut unemployment aid early but data has not shown that it dramatically boosted hiring compared to states that maintained assistance programs. Federal unemployment programs are slated to expire on Sept. 10 as the economy continues its path to recovery.

The Labor Department report showed that the biggest job losses occurred in the retail sector with 29,000 jobs lost.

August is the last full month of summer and the sectors that benefit most from the season, such as travel and leisure, are seeing business slow as parents take their children back to school and return to the workplace.