Washington, DC, August 4, 2006--Job growth continued at its lukewarm pace in July, the Labor Department said Friday.
U.S. nonfarm payrolls rose by 113,000 in July after a revised 124,000 gain in June, the agency said.
Economists surveyed by MarketWatch were expecting payroll gains of about 143,000 in July.
The unemployment rate rose to 4.8% in July from 4.6% in June. This is the highest level since February.
Average hourly earnings rose 0.4% and are up 3.8% year-on-year. Economists had been expecting a 0.3% gain in earnings.
Economists have viewed the July nonfarm payroll report as critical piece of the puzzle over whether the Fed will hike rates again or pause on Aug. 8. The sluggish pace of job growth and the rise in the unemployment rate may give the Fed room to pause after 17 straight meetings with a rate increase.
The gain in payrolls is in line with the average job growth of 112,000 in the second quarter. This is a slower trend than the 176,000 job pace in the first three months of the year.
In July, goods-producing industries lost 2,000 jobs while private-sector service-producing jobs gained 115,000.
Within services, retail jobs were flat after three straight monthly declines.
The biggest gain was in professional services which added 43,000 jobs.
The manufacturing sector lost 15,000 jobs in July, reversing a gain of 22,000 in the previous month.
Construction employment rose by 6,000 in July, the first increase in the past three months.
Among 278 industries, 53.2% were adding employees in July. Among 84 manufacturing industries, 45.2% were adding jobs.
Average hourly wages rose 7 cents or 0.4% to $16.76. Average hourly earnings are up 3.8% in the past year. June wage gains were revised down to a 0.4% gain, compared with the initial estimate of a 0.5% increase.
The average workweek was steady at 33.9 hours. Within manufacturing, average hours rose to 41.5 from 41.3 in June. Factory overtime was down 6 minutes to 4.5 hours.
Total hours worked in the economy rose 0.1% to 105.2. The manufacturing index rose by 0.4% to 97.3.
