Companies in the U.S. added workers in July for a seventh straight month at a pace that suggests the labour-market recovery will be slow to take hold.
Private payrolls that exclude government agencies rose by 71,000 after a June gain of 31,000 that was smaller than previously reported, Labor Department figures in Washington showed today.
Economists projected a 90,000 July increase, according to the median estimate in a Bloomberg News survey. Overall employment fell 131,000 and unemployment held at 9.5%.
Stock-index futures fell as the report showed an economy that will be slow in recouping the 8.4 million jobs lost since the recession began in December 2007, keeping consumer spending from accelerating. While growth has slowed and Federal Reserve Chairman Ben S. Bernanke has described the outlook as "unusually uncertain," financial markets have rebounded: the Standard & Poor’s 500 Index last month climbed the most in a year and commodities rallied.
Total employment fell a revised 221,000 in June, today’s figures showed. Payroll estimates in the Bloomberg survey of 84 economists ranged from a decline of 160,000 to a gain of 10,000 after a previously reported loss of 125,000 jobs in June that was led by census dismissals.
Private employment in July was led by gains in manufacturing and education and health services. Estimates in the Bloomberg survey ranged from increases of 20,000 to 150,000.
Economists surveyed forecast the jobless rate would rise to 9.6% last month from 9.5% in June. The July unemployment figure reflected a decrease in the size of the labour force.
Joblessness, which reached a 26-year high of 10.1% in October, will take time to recede as the number of previously discouraged jobseekers returning to the labour force exceeds the number of available jobs.
The Census Bureau said it let go about 144,000 of the people conducting the decennial population count from mid-June to mid-July. It still had about 200,000 temporary workers on staff as of July 17, indicating additional cuts to come that will keep distorting the payroll figures for months.
For that reason, economists say private payrolls will be a better gauge of the state of the labor market for much of 2010.
Manufacturing payrolls increased by 36,000 in July, more than the survey median of a 13,000 increase and reflecting a 21,000 rise in employment in the motor vehicle and parts industry.
Those factory gains may slacken as the industry leading the U.S. economic expansion cools. A report this week showed manufacturing expanded in July at the slowest pace of the year as orders and production decelerated.
Employment at service-providers fell for a second month. Construction companies cut payrolls by 11,000 after reducing them 21,000 in June. The number of temporary workers decreased by 6,000, the first drop since September.
Average hourly earnings rose four cents to $22.59 in July, today’s report showed. The average work week for all workers increased to 34.2 hours in July from 34.1 hours the prior month.
Government payrolls decreased by 202,000. State and local governments employment declined by 48,000, while federal government jobs dropped by 154,000.
The so-called underemployment rate -- which includes part-time workers who’d prefer a full-time position and people who want work but have given up looking -- held at 16.5%.
