Washington, Sep 2 (IANS): Private companies in the US added 374,000 jobs in August, fewer than expected, indicating a slowing labour market recovery amid a Delta variant-fuelled Covid-19 resurgence, payroll data company Automatic Data Processing (ADP) reported.

The latest data released on Wednesday "has highlighted a downshift in the labour market recovery", said Nela Richardson, chief economist at ADP.

"We have seen a decline in new hires, following significant job growth from the first half of the year."

In the second quarter, the private sector saw an average monthly job growth of roughly 748,000 amid vaccination progress and continued economic recovery, according to the report, which was produced by the ADP Research Institute in collaboration with Moody's Analytics, reports Xinhua news agency.

In July, however, private companies added a downwardly revised 326,000 jobs, a marked slowdown from the second quarter.

Despite the slowdown, Richardson noted that job gains are approaching 4 million this year, while adding that it's still 7 million jobs short of pre-pandemic levels.

Service providers continue to lead growth, with 329,000 jobs added in the month, although the Delta variant creates "uncertainty" for this sector, Richardson said, noting leisure and hospitality made up 201,000 of the job gains.

Large firms and medium-sized businesses hired about 138,000 and 149,000 workers, respectively, while small companies added some 86,000 employees, the ADP report showed, indicating an unbalanced recovery across different company sizes.

The ADP report came two days ahead of the crucial monthly employment report to be released by the Labour Department's Bureau of Labour Statistics, which will include employment data from both the private sector and the government.