Job losses continued to mount in the U.S. economy last month, though at a more modest pace than expected, putting further pressure on policy makers to take action to spur growth and employment.

A separate report indicated the U.S. nonmanufacturing sector expanded at a much slower pace last month.

Nonfarm payrolls fell by 54,000 last month, matching the level of revised losses recorded the previous month, the U.S. Labor Department said Friday. The revision in July layoffs to 54,000 followed an original estimate of a 131,000 drop in payrolls.

The U.S. economy has shed jobs for three straight months, though the losses in August were about half the 110,000 predicted by economists in a Dow Jones Newswires survey.

The unemployment rate, calculated using a separate household survey, edged up to 9.6%, as expected, after holding at 9.5% for previous two months.