U.S. Economy Sheds More Jobs in July

By Toni Vranjes

August 6, 2010

The latest employment report shows that the job market continues to struggle.

The Census Bureau laid off more temporary workers last month, and the economy overall lost 131,000 jobs. While the federal government shrank, the private sector created only 71,000 jobs. Gains occurred in manufacturing, health care, and mining. But employment in temporary-help services — considered a leading indicator for hiring trends — declined in July.

Meanwhile, the jobless rate held at 9.5 percent, the Labor Department reported today.

Private-sector hiring fell short of expectations, notes Sophia Koropeckyj, managing director for Moody’s Analytics. Business confidence is low, and several factors are at work.

“A lot of large companies are sitting on mountains of cash and are profitable, but they’re still not comfortable enough with the economy to hire workers,” she says.

“And small companies still have poor access to credit, and lot of these companies rely on credit for their payrolls. So a lot of companies that want to hire workers aren’t able to do so.”

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