US employers add 162K jobs; rate falls to 7.4 pct.

By Christopher S. Rugaber,AP Economics Writer

August 2, 2013

WASHINGTON (AP) — U.S. employers added 162,000 jobs in July, a modest increase and the fewest since March. Still, the unemployment rate fell to a 4½-year low of 7.4 percent, a hopeful sign in an otherwise lackluster report.

Unemployment declined from 7.6 percent in June because more Americans found jobs, and others stopped looking and were no longer counted as unemployed.

Still, Friday’s report from the Labor Department pointed to a less-than-robust job market. It suggested that the U.S. economy’s subpar growth and modest consumer spending are making many businesses cautious about hiring.

The jobs report “reveals a mixed labor market picture of continued improvement, but at a still frustratingly slow pace,” said Scott Anderson, chief economist at Bank of the West.

The government said employers created a combined 26,000 fewer jobs in May and June than previously estimated. Americans worked fewer hours in July, and their average pay dipped. And many of the jobs employers added last month were for lower-paying work at stores, bars and restaurants.

For the year, job growth has remained steady. The economy has added an average 200,000 jobs a month since January, though the pace has slowed in the past three months to 175,000.

The reaction from investors was slightly downbeat. The Dow Jones industrial average dropped 38 points in late-morning trading, and broader stock indexes also declined. The yield on the 10-year Treasury note fell to 2.62 percent from 2.71 percent.

The Federal Reserve will review the July employment data in deciding whether to slow its $85 billion a month in bond purchases in September, as many economists have predicted it will do. Weaker hiring could make the Fed hold off on any pullback in bond buying, which has helped keep long-term borrowing costs down.

Yet it’s possible that the lower unemployment, along with the job gains the past year, could convince the Fed that the job market is strengthening consistently.

“While July itself was a bit disappointing, the Fed will be looking at the cumulative improvement,” said Paul Ashworth, chief U.S. economist at Capital Economics. “On that score, the unemployment rate has fallen from 8.1 percent last August, to 7.4 percent this July, which is a significant improvement.”

But Beth Ann Bovino, senior economist at Standard & Poor’s, said she thinks Friday’s report will make the Fed delay any slowdown in its bond purchases.

“September seems very unlikely now,” she says. “I’m wondering if December is still in the cards.”

July’s decline in unemployment to 7.4 percent was derived from a survey of households, which found that 227,000 more people said
they were employed. And 37,000 people stopped looking for work and were no longer counted as unemployed.

The job gain for the month was calculated from a separate survey of employers.

Though much of July’s job growth was in lower-paying industries, manufacturing, a generally good-paying sector, added 6,000 jobs.
That growth was driven by gains at auto plants. Those were the first job gains at U.S. factories since February.

Jobs in professional services such as finance, accounting and information technology also rose.
Governments added jobs for the first time since April, driven by the fifth straight month of hiring by local government.

Job gains are being slowed by the economy’s tepid growth. It grew at an annual rate of just 1.7 percent in the April-June quarter, the government said this week. That was an improvement over the previous two quarters, but it’s still far too weak to rapidly lower unemployment.

The government revised down June’s job growth to 188,000 from 195,000 and May’s to 176,000 from 195,000.

Recent data suggest that the economy could strengthen in the second half of the year. A survey Thursday showed, for example, that factories increased production and received a surge of orders in July, propelling the fastest expansion in more than two years.

The survey, by the Institute for Supply Management, also showed that the housing recovery is spurring more output by lumber companies, furniture makers and appliance manufacturers.

Businesses have ordered more industrial machinery and other equipment for four straight months. Europe’s troubled economies are showing signs of recovery, potentially a lift to U.S. exports.

U.S. automakers are reporting their best sales since the recession, a sign that Americans are confident enough in their finances to make large purchases. Car sales rose 14 percent in July from 12 months earlier to 1.3 million.

Healthy sales have encouraged more hiring by Ford Motor Co. The company said last week that it will hire 800 salaried professionals this year, mostly in areas such as information technology, product development and quality control.

7 Comments on this post.

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  • jorge buesa
    2 August 2013 at 10:41 pm - Reply

    Unemployment rate is it for Full or Part time workers, because they is alot part-time in america now ?

    • Delia
      5 August 2013 at 4:23 am - Reply

      Some economists are raising warning flags over the fact that 77 percent of this year’s new jobs are part-time, saying the numbers provide a bleak portrayal of the labor market.

  • noz
    3 August 2013 at 9:32 am - Reply

    american workforce are by enlarged part timers. the business community’s answer to obamacare of either no more than 50 employees, or converted part time equivalent work hours. that’s why, obamacare through the pressures of the union leaders demanded delay of obamacare implementation, which obama approved the delay for another year. the action of obama to delay the implementation of obamacare are being challenged by the legal experts on the ground obamacare is now a law of the land, and obama has no power to delay its implementations.

    • Delia
      3 August 2013 at 4:13 pm - Reply

      There is no surprise to this deception. Everything that the Obama administration presents to the American people are deceptive. They were conceived on lies, deceptions, and fraud. Therefore the products of what they do are all fake!!.

      They make the American people so stupid to understand that what they do are all deceptions. They are aided by MSM the channel of false information, being feed to the American people. Why do so many stupid people believe? Because they benefit from the handouts of Obama paid for by our tax money.

      About 50% of jobs are part time, and they count it as full time employed. Those who claimed disability benefits have doubled, and therefore no longer looking for jobs. Some of those claimants have fake disabilities. If you believe any numbers the federal govt puts out or for that matter anything the federal govt says, well then you deserve to go down with the Titanic.

    • jorge buesa
      4 August 2013 at 10:22 am - Reply

      Noz your so right, american workforce are by enlarged part timers ! Obama has kill the American Dream !

  • JAY
    3 August 2013 at 12:34 pm - Reply

    Get your facts straight Balitang America. Wag yong copy lang kayo ng copy. 85% of July jobs are Part timers. Lets all thank to obamacare.

  • what???
    5 August 2013 at 9:14 am - Reply

    Job is a job.. at least may trabaho hindi tulad ng marami dyan, naka nganga lang araw araw…