Unemployment levels in the U.S. have fallen to 8.4% and 1.4 million jobs were created in August according to a new Department of Labor report.

The month-over-month decline in joblessness signals an ongoing economic recovery as the U.S. battles with the aftermath of the COVID-19 pandemic.

At the onset of the pandemic in April, joblessness rates reached 15%, indicating the U.S. economy had entered a recession.

Although unemployment has slowly declined since April, the joblessness rate is still well above pre-pandemic levels -- 3.5%.

Employment numbers were boosted throughout the summer as businesses began to rehire or acquire new workers. This increase in employment has begun to cool, which points to the fact that we are not out of the woods yet.

While the U.S. economy is certainly rebounding, it remains to be seen whether the economy will reach pre-pandemic levels. In August, there were 11.5 million fewer jobs in comparison to February, a month before the pandemic officially began.

The U.S. economic recovery has been mostly touch-and-go. From April to June, small businesses began increasingly hiring workers, which had stagnated by August. By the end of August, employment levels reached 77% of January levels.

Since the pandemic began, the number of individuals receiving unemployment benefits has remained quite high. In mid-August, approximately 29 million people were receiving state or federal unemployment assistance.

Throughout August, U.S. companies announced planned layoffs of furloughed and active workers, including American Airlines which plans to shed 19,0000 jobs by Oct. 1.

In addition to the airline industry, hospitality and leisure has been battered by the pandemic as fewer Americans book stays at resorts, casinos, and hotels. A prime example of this being MGM Resorts, which announced plans to cut 18,000 jobs, equal to one-third of the company’s total workforce.

Economists have argued that sweeping layoffs throughout the country show a change in thinking on the part of companies. In the beginning, it was assumed that the pandemic would only last a few weeks, making furloughs and layoffs temporary.

Companies have begun to change their strategy as it becomes clearer that a post-pandemic recovery will not arrive as quickly as they had anticipated.

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