WASHINGTON -- U.S. companies added 179,000 jobs in July, according to a private survey, a steady gain suggesting that hiring remains healthy after a sharp falloff in the spring.
Payroll processor ADP said Wednesday that last month's job growth was driven by services companies -- such as retailers and shipping firms -- which added 185,000 positions. Construction companies, by contrast, cut jobs. And manufacturers added a meager 4,000 positions.
The report showed that many businesses are hiring even as economic growth has remained sluggish. The additional jobs could help keep Americans spending and support an acceleration of the economy in the second half of the year.
"Job growth remains strong, but is moderating as the economy approaches full employment," Mark Zandi, chief economist at Moody's Analytics Inc. in West Chester, Pa., said in a statement. Moody's compiles the figures with ADP. "Businesses are having a more difficult time filling open job positions, which are near record highs. The nation's biggest economic problem will soon be the lack of available workers."
Solid gains occurred in both higher-paying and lower-paying industries, extending a trend of greater hiring at the upper and lower levels of the pay scale, with fewer gains in middle-income jobs.
Financial-services firms added 11,000 jobs, and professional and business services, a category that includes upper-income positions such as engineers and architects, as well as low-paying, temporary jobs, added 59,000.
Still, the ADP figures cover only private businesses, and they often diverge from the government's official jobs reports. Economists have forecast that the government's employment report for July, to be released Friday, will show a gain of 175,000 jobs and that the unemployment rate will dip to 4.8 percent from 4.9 percent.
That would be below June's gain of 287,000 jobs, but it would serve as evidence that hiring has recovered after plunging to just 11,000 added positions in May and a modest 144,000 in April.
Sluggish economic expansion this year has analysts questioning the health of the broader economy. Growth slowed to an annual pace of 1 percent in the first six months of the year, below the already-tepid 2 percent pace of the 7-year-old recovery.
And despite decent job gains in some months, companies have pulled back on hiring this year: Job growth averaged 172,000 a month, according to the government's figures, in the first half of this year -- down from 237,000 a month in the final six months of last year.
That downshift likely shows the unemployment rate is nearly back to what economists call "full employment" and that there are fewer unemployed job applicants to fill positions. That trend can weaken hiring, particularly when economic growth is sluggish.
Still, the unemployment rate may keep falling. Most analysts estimate that the economy needs to add about 85,000 jobs a month to absorb population growth and keep the unemployment rate steady.
Information for this article was contributed by Michelle Jamrisko of Bloomberg News.
Business on 08/04/2016