Rate of unemployment likely unchanged in July: preview of the United States economy

July 31, 2011, 12: 23 AM EDT by Bob Willis

July 31 (Bloomberg) - United States probably not creating enough jobs in July to reduce unemployment, which shows anxiety on the deliberations of debt of the Government and a slowdown in consumer spending have shaken the confidence of employer, economists said before reports this week.

Report payroll uploaded by 90,000 workers after an increase of 18,000 in June was the smallest this year, according to the median forecast of 62 economists surveyed by Bloomberg News before a Department of labor on August 5. The unemployment rate was held at 9.2 per cent after uploading each of the three previous months.The lack of jobs is threatening to further reduce consumption spending, so the risk that the economic recovery will come to a halt. "The impossibility of reaching an agreement to raise the ceiling for debt and growth unexpectedly weak in the first half of 2011 caused standard & poor's 500 to 3.9 percent last week, more than one year".Any uncertainty we are seeing right now is to maintain prudent companies and households cautious, "said James Knightly, a senior economist at ING Bank NV in London." "It is unlikely that anyone is going to go on an orgy of recruitment in such an environment." "The risk is that we see ongoing softness."Private payrolls, which excludes public employment, 115,000 rose after a gain of 57,000 in the previous month, economists forecast that employment report will also be displayed.Growth SlowdownThe economy grew at a less that forecast 1.3 percent pace in the second quarter following revised growth of 0.4 per cent in the first three months of the year which was less than previously estimated, the Commerce Department reported last week. Consumption expenditure increased by 0.1%, the lowest profit since the second quarter of 2009, in the last months of the recession.The gain in payroll bring the average from may until July to 44,000 under 215,000 in the previous three months.Increases of about 125,000 a month are needed to keep the unemployment rate steady, while some 200,000 a month would take a percentage point more than one year, according to Stephen Stanley, Economist head of Pierpont Securities LLC in Stamford, Connecticut.Through June, the economy had recovered about 1.77 million of 8.75 million jobs lost as a result of the recession in 18 months that began in 2007.In December his semi-annual testimony before Congress this mesPresidente of the Federal Reserve Ben S Bernanke said that the "economy still need to do a good support."Bernanke's view "more recent data testifies to the persistent weakness of the labour market", Bernanke said on July 13. "It is improving very slowly in terms of employment recovered." Wages are very stagnant and that is affecting the confidence of consumers spending and consumption. "There is also continuing uncertainty about the durability of the recovery."The fall of the stock last week was accompanied by an increase in Treasury securities. The performance of the reference note 10 years fell to 2.80 later on 29 July, the lowest since November 30.com some companies are firing workers to keep costs down as the economy slows and the uncertainty is built on the roof of the debt, European default risk and regulatory and tax costs.Cisco Systems Inc., the largest manufacturer of networking equipment, plans to eliminate 6,500 jobs, or 9 percent of its full-time force labour world, helping to cut more than one billion dollars in annual costs and accelerate the growth of earnings.The job cuts will come through the company and are not concentrated in a single unit, said Karen Tillman, a spokesman for the company, in an interview on July 18. The company said the workers affected in United States and Canada will be notified this week.Manufacture of CoolsManufacturing, a stalwart of the expansion, grew at a slower pace last month, a report may show tomorrow. The Institute for Supply Management's factory index fell to 54.5 of 55.3 last month, according to a poll of economists Bloomberg. A reading above 50 indicates growth.Factory orders fell 0.8 percent in June after 0.8% gain the previous month, the Commerce Department report on August 3 industries. services, which cover about 90 percent of the economy, grew at a faster pace, that a report may show the same day as forecast by economists. ISM manufacturing business index rose not 53.7 in July of a 53.3 a month earlier, according to Bloomberg News survey.

-With the assistance of Chris Middleton in Washington. Editors: Carlos Torres, Vince Golle

To contact the reporter on this story: Bob Willis in Washington at bwillis@bloomberg.net

To contact the editor responsible for this story: Christopher Wellisz in cwellisz@bloomberg.net

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