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Solid US Job Gains Could Bolster 2nd-half Growth

By CHRISTOPHER S. RUGABER

WASHINGTON (AP) â¿¿ Robust hiring in July would mark a fourth straight month of solid gains, an encouraging sign for a U.S. economy that is still struggling with high unemployment.

Economists predict that employers added 183,000 jobs â¿¿ a figure that would show that businesses are growing more confident despite weak economic growth. More jobs would boost consumers' ability to spend, allowing for stronger growth in the second half of the year.

The unemployment rate is expected to have dipped last month to 7.5 percent from 7.6 percent. The Labor Department will release the report at 8:30 am EDT Friday.

The Federal Reserve will pay particularly close attention to the report. Many economists think the Fed could begin scaling back its $85 billion monthly bond purchases later this year if the economy and job market continue to strengthen.

Hiring has improved this year. Employers have added an average of 202,000 a month since January, up from an average of 180,000 in the previous six months.

Yet economic growth remains sluggish. The economy grew at a subpar 1.7 percent annual rate in April-June quarter, the government said Wednesday. While that was an improvement over the previous two quarters, it's still far too weak to rapidly lower unemployment.

Recent data suggest that the economy could strengthen in the second half of the year.

A survey Thursday showed that factories increased production and received a surge of new orders in July, propelling the fastest expansion in more than two years. Factories also hired workers at the fastest pace in a year.

The survey, by the Institute for Supply Management, also showed that the housing recovery is spurring more output by lumber companies, furniture makers and appliance manufacturers.

Businesses have ordered more industrial machinery and other equipment for four straight months. Europe's troubled economies are showing signs of recovery, potentially a lift to U.S. exports.

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