WASHINGTON — Companies showed a lack of confidence about hiring for a third straight month in July, making it likely the economy will grow more slowly the rest of the year. The U.S. unemployment rate was unchanged at 9.5 percent.
Private employers added a net total of only 71,000 jobs in July, far below the 200,000 or more jobs needed each month to reduce the unemployment rate.
The modest gains were even weaker when considering a loss of government jobs at the local, state and federal levels in July that weren't temporary census positions. Factoring those in, the net gains were only 12,000 jobs, according to the Labor Department's July report Friday.
The department also sharply revised down its jobs figures for June, saying businesses hired fewer workers than previously estimated. June's private-sector job gains were lowered to 31,000 from 83,000. May's were raised slightly to show 51,000 net new jobs, from 33,000.
"There is still a labor market recovery, but it's a very, very weak one," said Nigel Gault, chief U.S. economist at IHS Global Insight.
President Barack Obama on Friday noted that the economy has now added private-sector jobs for seven straight months. He hailed that as a good sign. But he said the progress "needs to come faster."
Overall, the economy lost a net total of 131,000 jobs last month, mostly because 143,000 temporary census jobs ended.
The "underemployment" rate was the same as in June, at 16.5 percent. That includes those working part time who would prefer full-time work and unemployed workers who have given up on their job hunts.
All told, there were 14.6 million people looking for work in July. That's roughly double the figure in December 2007, when the recession began.
Even if hiring picks up, it will take years to regain all the jobs lost during the recession. The economy lost 8.4 million jobs in 2008 and 2009. This year, private employers have added only 559,000 new jobs.
Friday's report is being closely watched by the Federal Reserve as it considers ways to energize the recovery. The report could persuade the Fed to take new steps to boost the economy and keep interest rates at record lows when it meets next week.
Without more jobs, consumers won't see the gains in income needed to encourage them to spend more and support economic activity. Even those with jobs may not feel confident enough to ramp up their spending.
Many companies appear to be getting more out of their current employees rather than adding new staffers. The average workweek increased by one-tenth of an hour to 34.2 hours, the department said. That's up from about 33 hours in the depths of the recession.
Average hourly pay also rose 4 cents to $22.59, up 1.8 percent from a year earlier. That, along with the increase in hours worked, could provide some boost to spending.
The number of temporary jobs fell by 5,600, the first drop after nine months of gains.
Manufacturers added 36,000 jobs in July, slightly above the monthly average this year. Those gains were aided by General Motors' decision to keep its plants running last month. Usually it closes them and temporarily lays off employees to retool for the new model year.
Construction firms cut jobs for the third straight month, losing 11,000, while financial firms shed 17,000 workers.
But retailers added 6,700 jobs. And the leisure and hospitality industry hired 6,000 additional staffers.