WASHINGTON - Stores, factories and other businesses large and small showed workers

the door last month, sending unemployment to its highest rate in four years and
adding to the evidence an economic recovery remains far off.

Employers clamped down on hiring and cut 51,000 jobs in July, the Labor Department
said Friday. The economy has shed jobs each month this year _ 463,000 in all.

The unemployment rate rose to 5.7 percent, up from 5.5 percent in June.

The jobs report contributed to another day of grim news for the economy. General
Motors reported a staggering quarterly loss of more than $15 billion and said its
sales fell by more than a quarter from last year.

Job losses in July were the heaviest in industries hard hit by the slow housing
market, the clampdown on credit and the shaky financial sector. Manufacturers cut
35,000 jobs, construction companies 22,000 and retailers 17,000.

Temporary help firms, also viewed as a barometer of demand for future hiring,
eliminated 29,000 jobs. Those losses swamped job gains elsewhere, including in the
government, education and health care.

The increase in the unemployment rate in July came as many young people streamed
into the labor market looking for summer jobs. Fewer of them were able to find
work. The unemployment rate for teenagers jumped to 20.3 percent, the highest
since 1992.

Still, the job losses were not as some fears. Economists were expecting 72,000
jobs lost for July. The government also revised the job-loss figures for May and
June to a combined 98,000, down from 124,000.

All told, there were 8.8 million people unemployed in July, up from 7.1 million
last year. The jobless rate last July was a full percentage point below where it
was this July.

Wages went up modestly last month, but prices have been rising faster. Average
hourly earnings rose to $18.06, up about 3 percent from last year. High food and
fuel costs mean paychecks aren't stretching as far, though.

"It's easy to see why consumer spending is expected to remain weak through the
summer, if not the rest of the year," said Bernard Baumohl, managing director and
chief economist at The Economic Outlook Group.

The Federal Reserve is expected to hold interest rates steady next week as it
tries to grapple with dueling concerns _ a weak economy and inflation.

____

AP Business Writer Christopher S. Rugaber contributed to this report.

Copyright 2008 The Associated Press. All rights reserved. This material may not be
published, broadcast, rewritten or redistributed.
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