Investors reacted by selling stocks and shifting into more conservative Treasury bonds. The yield on the 10-year Treasury note, which helps set rates on mortgages and other consumer loans, fell to 2.85 percent from 2.91 percent late Thursday. Major stock indexes all fell.
The department also sharply revised down its jobs figures for June, saying businesses hired fewer workers than previously estimated. June's private-sector job gains were lowered to 31,000 from 83,000. May's were raised slightly to show 51,000 net new jobs, from 33,000.
"There is still a labor market recovery, but it's a very, very weak one," said Nigel Gault, chief U.S. economist at IHS Global Insight.
Among those hiring in July was New Way Air Bearings in Aston, Delaware County, a manufacturer of frictionless bearings for the making of precision machine tools and flat-panel displays.
"Business is growing back again and we need people,"said Nick Hackett, the company president. "We've seen a broad increase in orders across all our markets.
The company hired three people in July and a total of 13 so far this year. As business declined during the recession, New Way's employment dropped to 37 from about 80. Now the company is ramping up to 55.
That will include three more openings - for a manufacturing development engineer, a product development engineer and a production controller."
But finding people for some jobs has been tough, Hackett said. While most of those offered jobs accepted them, Hackett said, two machinists turned them down, saying the jobs didn't pay enough to make it worth going off unemployment benefits.
Overall, the economy lost a net total of 131,000 jobs last month, mostly because 143,000 temporary census jobs ended.
