U.S. July Payrolls Rise More Than Forecast; Unemployment 8.3%
By Shobhana Chandra - Aug 3, 2012 8:30 AM ET
Payrolls in the U.S. climbed more than forecast in July, boosted by a pickup in employment at automakers even as the jobless rate unexpectedly rose to a five- month high.
Payrolls increased 163,000 following a revised 64,000 rise in June that was less than initially reported, Labor Department figures showed today in Washington. The median estimate of 89 economists surveyed by Bloomberg News called for a gain of 100,000. Unemployment rose to 8.3 percent.
Uneven hiring may hold back consumer spending, the biggest part of the economy, as a global slowdown and impending U.S. tax changes weigh on businesses. Job cuts at companies from Morgan Stanley (MS) to Cisco Systems (CSCO) Inc. mean unemployment may remain elevated, one reason the Federal Reserve this week said it is prepared to take new steps if needed to boost growth.
“Job growth is not enough to make a big dent in the unemployment rate,” Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez Inc. in New York, said before the report. “It is unrealistic to expect strong gains in consumer spending. Fed officials will wait until they get a better idea of what will happen on the fiscal policy front.”
Estimates in the Bloomberg survey ranged from increases of 50,000 to 165,000 after a previously reported 80,000 gain in June. Revisions to prior reports subtracted a total of 6,000 jobs to payrolls in the previous two months.
Private payrolls, which exclude government agencies, rose 172,000 after a revised gain of 73,000. They were projected to rise by 110,000, the survey showed.
The unemployment rate was forecast to hold at 8.2 percent, according to the survey median. Estimates in the Bloomberg survey ranged from 8.1 percent to 8.3 percent. The report showed more people left the labor force.
Factory Jobs
Factory payrolls increased by 25,000, more than twice the survey forecast of a 10,000 increase and boosted by a 12,800 pickup in employment at makers of motor vehicles and parts.
The figures may have reflected fewer shutdowns at automakers for annual retooling related to the new model year, indicating the jump will be reversed this month. Chrysler Group LLC and Ford Motor Co. (F) are among companies that said they would idle fewer plants.
Demand for so-called big-ticket items like automobiles may be cooling. Car and light trucks sold at a 14.1 million annual rate in July, down from a revised 14.3 million in June and indicating little momentum as the industry heads for the best year since 2007, according to Ward’s Automotive Group.
more:
http://www.bloomberg.com/news/2012-08-03/u-s-july-payrolls-rise-more-than-forecast-unemployment-8-3-.html
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