Is job growth slowing? Planned layoffs hit nearly 4-year high in July

WASHINGTON – Employers announced more layoffs in July than any month in nearly four years and the pace of planned job cuts this year is the most since the Great Recession, career counseling firm Challenger, Gray &Christmas Inc. said Thursday.

More than half of the cuts announced last month were from the U.S. Army, which plans to eliminate 57,000 positions over the next two years, Challenger said.

The report followed one Wednesday from payroll firm Automatic Data Processing that showed the private-sector added 185,000 net new positions last month, down from 229,000 in June.

The new data indicate the pace of job growth could be slowing, but a more definitive assessment will come Friday.

Analysts expect the Labor Department to report that the economy added about 212,000 net new jobs last month, a solid figure though down from 223,000 in June.

The unemployment rate is forecast to have held steady at 5.3 percent, the lowest in seven years.

Initial jobless claims are consistent with those forecasts.

About 270,000 people filed for first-time unemployment benefits last week, the Labor Department said Thursday. That was up 3,000 from the previous week but still near a 40-year low and consistent with solid job growth.

The new reports from ADP and Challenger, however, raise concerns about the strength of the labor market.

Employers last month announced plans to lay off 105,696 workers, up sharply from 44,842 in June, Challenger said. The July figure was the most since September 2011.

In the first seven months of the year, private and public employers announced 393,368 layoffs, Challenger reported. That’s the most since 2009, when planned job cuts surged to 978,048 during the same period.

In contrast, employers in 2014 announced the fewest job cuts in 17 years, according to Challenger.

Federal Reserve policymakers are considering the first increase in the central bank’s benchmark interest rate since 2006.

Many analysts expect a small hike in September if the next two Labor Department jobs reports are solid. But a weaker-than-expected July report could give Fed policymakers pause and delay a rate hike.