Not surprisingly, some of the steepest job losses were in the troubled housing sector, which has been walloped by falling home values and foreclosures against borrowers who can't make escalating payments on adjustable-rate loans.
Construction, depressed by the collapse of the housing market, lost an additional 43,000 jobs in June. Since its peak in September 2006, construction employment has fallen by 528,000. An additional 33,000 jobs were lost in the manufacturing sector.
But there were also signs of weakness in other areas, including retail trade and financial services. Government jobs were a bright spot, accounting for 29,000 new positions, and there was hiring in the healthcare and hospitality sectors. But those gains were outpaced by the losses in other parts of the economy.
Altogether, the private sector contracted by 91,000 jobs. Generally, the economy must create about 100,000 jobs a month to keep pace with the increasing population; this year, the economy has lost an average of 73,000 jobs a month.
The employment reports for April and May, meanwhile, were revised downward to show an additional 52,000 job losses.
"It's persistent bad news," said Diane Swonk, chief economist with Mesirow Financial in Chicago. "The economy is growing, but realistically it feels like a recession to most people."
Recessions are generally defined as periods when gross domestic product slips into negative territory for two or more consecutive quarters. But the National Bureau of Economic Research, the panel that makes the official designation of a recession, tends to use a more complex analysis that emphasizes job creation and industrial production.
The economic bureau usually waits until downturns are over before applying the "recession" label. But economists said the sense of a downturn is so strong that an official declaration has become almost irrelevant.
"Technically, we're probably not in a recession, but that doesn't matter," Naroff said. "It feels as if we are, and that's much more critical than any definition."
Soaring oil prices are not making the job picture any brighter, said Steven Davis, a labor economist at the University of Chicago. He said uncertainty about how high energy prices could climb may keep some firms from investing in new plants and new workers.
"Oil prices are high, but there is also a lot of uncertainty about whether they will go higher," Davis said. "The answer to that question has a big impact for businesses in terms of what kinds of capital equipment they will adopt. This uncertainty is also depressing economic activity and hiring."
In New York futures trading Thursday, oil closed at a record $145.29 a barrel, up $1.72, or 1.2%. Traders pointed to market nervousness about tension in the Mideast and fears that global fuel demand may test tight oil supplies.
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maura.reynolds@latimes.com
