WASHINGTON (AP) -- Hiring cooled off in July, pushing the nation's unemployment up to 4.6 percent, a six-month high.þþThe fresh snapshot of employment conditions around the country, released by the Labor Department Friday, also showed that new job creation slowed. Employers increased payrolls by 92,000 last month, the fewest add-ons in a single month since February.þþJob losses in construction, manufacturing, retailing and by the government blunted gains in education and health care, professional and business services, and leisure and hospitality.þþEven with the uptick from June's 4.5 percent unemployment rate, the current jobless rate is still low by historical standards. Those with jobs, meanwhile, did see modest wage gains.þþKen Mayland, president of ClearView Economics, likened the new figures to a modest middle ground, saying the job market is ''running not too hot and not too cold.''þþThe more subdued jobs picture is consistent with economists' forecasts that the economy will grow gradually -- but not like gangbusters-- through the rest of this year. The economy has been coping with fallout from the sour housing market, problems with higher-risk subprime mortgages and troubles in the automotive sector.þþThe news comes as President Bush has been trying to counter weak public-approval ratings for his handling of the economy. Only 37 percent approve of his performance, close to a record low, according to a recent AP-Ipsos poll.þþThe new employment picture was weaker than economists expected. They were forecasting employers to add around 135,000 jobs in July and for the unemployment rate to hold steady at 4.5 percent. The new figures suggest the jobs climate wasn't as robust as first thought at the start of the third quarter.þþWages grew modestly.þþAverage hourly earnings rose to $17.45, a 0.3 percent increase from June. That matched economists' expectations. Over the past 12 months, wages grew by 3.9 percent.þþWage growth supports consumer spending, a major ingredient in healthy overall economic activity. Still, workers pinched by high gasoline and food prices may not feel their paychecks are growing as much as they like.þþMany economists expect the Fed to hold an important interest rate at 5.25 percent next week, extending a more than yearlong breather for borrowers. Before that, the central bank had boosted rates for two years to thwart inflation.þþFed Chairman Ben Bernanke and his colleagues, however, still believe inflation is a potential threat to the economy. One of the things they are watching closely is whether the sturdy labor market -- which has allowed some workers to command higher wages and benefits -- could add inflationary pressures.þþOut-of-control inflation shrinks paychecks, erodes purchasing power and eats into the value of investments.þþJob growth in May and June turned out to be slightly weaker than the government previously thought.þþThe economy added 126,000 jobs in June, fewer than the 132,000 first reported. In May, employers boosted payrolls by 188,000, versus 190,000 previously estimated.þþThe job market still remains strong, but the toll of housing slump, seesawing economic activity and high energy prices are catching up with employers.þþConstruction companies slashed 12,000 jobs in July. Manufacturers shed 2,000 and retailers cut a thousand. Some 28,000 government jobs were eliminated. In contrast, education and health care added 39,000. Leisure and hospitality expanded employment by 22,000. Professional and business services added 26,000 new positions.þþThe 4.6 percent jobless rate was the highest since January, when the unemployment rate also stood at 4.6 percent.þþAt the start of this year, the economy nearly stalled, growing at a pace of just 0.6 percent, the slowest in more than four years. The economy rebounded in the April-to-June quarter, logging a rate of 3.4 percent, the best in more than a year. Growth in the July-to-September quarter is expected to be more subdued, possibly just under 3 percent.þþAcross the country, the time it took to find a job grew.þþThe average time the 7.9 million unemployed people spent in their job searches was 17.2 weeks in July. up from 16.8 weeks in June.þþWorries about the sour housing market along with fears that problems with higher-risk subprime mortgages will spread, caused stocks to crater last week. The carnage left the Dow Jones industrials down more than 585 points, its worst week in five years. Stocks have gyrated since then, reflecting lingering anxiety among investors.þþ
Source: NY Times
