Unemployment rises slightly as U.S. economy gains 209,000 jobs

The U.S. economy added more than 200,000 jobs for a sixth straight month, showing progress toward sustaining faster growth entering the sixth year of expansion. The improving conditions drew more job seekers into the labor force, pushing up the unemployment rate.

The 209,000 advance in employment in July followed a 298,000 June increase that was stronger than initially reported, figures from the Labor Department showed Friday in Washington. Unemployment climbed to 6.2 percent from 6.1 percent, while wages and hours were little changed from the prior month.

The degree of hiring this year may help trigger a self-reinforcing cycle of better spending and job opportunities that will spur the economy.

The job market "does look to be on a healthy growth track right now," said Alan Blinder, former vice chairman of the Federal Reserve and an economics professor at Princeton University in New Jersey. "It means less social distress from unemployment and an inability to find jobs. Secondly, it means more spendable income for the U.S. workforce."

At a news conference at the White House, President Barack Obama said: "The good news is the economy clearly is getting stronger. Our engines are revving a little bit louder. And the decisions that we make right now can sustain and keep that growth and momentum growing."

Construction companies and factories were among those that added more to payrolls in July than a month earlier. Employment gains cooled at retailers, business services and education and health services.

Yesterday's report showed average hourly earnings were little changed at $24.45 in July. They were up 2 percent over the past 12 months.

The underemployment rate -- which includes part-time workers who'd prefer a full-time position and people who want to work but have given up looking -- rose to 12.2 percent from 12.1 percent.