How to configure jenkins-agent to allow ssh via password?

I am trying to add a jenkins agent running Rocky Linux 8.

How do I configure an jenkins-agent to allow ssh connection from the jenkins-controller via password?

I did the following steps on the new agent:

• install openssh-server
• create user with the password I want to use
• create ssh keys
• password authentications was enabled by default at /etc/sshd/sshd_config

On the jenkins-controller I configured the node to:

• launch agents via SSH
• have credentials that match the configured user in the jenkins agent

I get the following error when I launch the agent from jenkins-web-UI:

ERROR: Unexpected error while trying to authenticate as jenkins-slave with credential=some-ID-111d-222e-33c44fg7h556
java.io.IOException: Password authentication failed.
    at com.trilead.ssh2.auth.AuthenticationManager.authenticatePassword(AuthenticationManager.java:404)
    at com.trilead.ssh2.Connection.authenticateWithPassword(Connection.java:340)
    at com.cloudbees.jenkins.plugins.sshcredentials.impl.TrileadSSHPasswordAuthenticator.doAuthenticate(TrileadSSHPasswordAuthenticator.java:115)
    at com.cloudbees.jenkins.plugins.sshcredentials.SSHAuthenticator.authenticate(SSHAuthenticator.java:431)
    at com.cloudbees.jenkins.plugins.sshcredentials.SSHAuthenticator.authenticate(SSHAuthenticator.java:468)
    at hudson.plugins.sshslaves.SSHLauncher.openConnection(SSHLauncher.java:886)
    at hudson.plugins.sshslaves.SSHLauncher$1.call(SSHLauncher.java:434)
    at hudson.plugins.sshslaves.SSHLauncher$1.call(SSHLauncher.java:421)
    at java.util.concurrent.FutureTask.run(FutureTask.java:266)
    at java.util.concurrent.ThreadPoolExecutor.runWorker(ThreadPoolExecutor.java:1149)
    at java.util.concurrent.ThreadPoolExecutor$Worker.run(ThreadPoolExecutor.java:624)
    at java.lang.Thread.run(Thread.java:748)
Caused by: java.io.IOException: The connection is closed.
    at com.trilead.ssh2.auth.AuthenticationManager.deQueue(AuthenticationManager.java:72)
    at com.trilead.ssh2.auth.AuthenticationManager.getNextMessage(AuthenticationManager.java:100)
    at com.trilead.ssh2.auth.AuthenticationManager.authenticatePassword(AuthenticationManager.java:379)
    ... 11 more
Caused by: java.io.IOException: Cannot read full block, EOF reached.
    at com.trilead.ssh2.crypto.cipher.CipherInputStream.getBlock(CipherInputStream.java:81)
    at com.trilead.ssh2.crypto.cipher.CipherInputStream.read(CipherInputStream.java:108)
    at com.trilead.ssh2.transport.TransportConnection.receiveMessage(TransportConnection.java:232)
    at com.trilead.ssh2.transport.TransportManager.receiveLoop(TransportManager.java:706)
    at com.trilead.ssh2.transport.TransportManager$1.run(TransportManager.java:502)
    ... 1 more

Any Idea why it fails?

EDIT I found that under /etc/pam.d/sshd there is the line session required pam_nologin.so. When I change that to optional I can login via ssh with a non-root user.