The United States economy shed 62,000 non-farm jobs in June while the unemployment rate unexpectedly remained at a four-year high of 5.5 percent, the U.S. Department of Labor reported last week. The number of job losses in June was particularly high in the goods-producing and service sectors.

A total of 43,000 positions were lost in the construction industry, which has been hit hard by a lengthy slump in the housing market, and the manufacturing sector suffered a loss of 33,000 positions. Professional and business services firms trimmed their payrolls by 51,000 positions. While employment continued to fall in construction, manufacturing and employment services, the Labor Dept. reported that health care and mining added jobs.

Payrolls have now fallen in all six months this year for a total job loss of 438,000, the strongest evidence yet that the economic expansion has slipped into a recession of uncertain depth and duration.

The Conference Board seems to support the Labor Dept.'s findings.

Yesterday, the research organization reported that its Employment Trends Index fell by 0.6 percent in June to 111.9, from 112.6 in May, and is down 8 percent since July 2007. Specifically, the index reported manufacturing, trade, construction and truck transportation industries shed 712,000 jobs over the past six months.

"The decline in payrolls is still mostly concentrated in the construction and goods related industries," said Gad Levanon, senior economist at The Conference Board. "Manufacturing, trade, construction and truck transportation industries shed 712,000 jobs in the last six months while the rest of the economy added 274,000 jobs."

Total non-farm employment peaked in December 2007 and has declined each month since then, reaching a total loss of 438,000 jobs. In addition to the jobs that were lost, the number of people who were working part-time but wanted a full-time job rose by 750,000 in the last six months.

"Most leading indicators of employment point to an even sharper deterioration in the labor market in the months ahead," added Levanon. "The steep decline of the employment trends index in recent months, and the fact that its weakness is spread throughout all of its components, does not leave much room for optimism."

Based on the latest Leading Indicator of National Employment (LINE) data, from the Society for Human Resource Management (SHRM) and the Rutgers University School of Management and Labor Relations, employment expectations are down substantially.

According to the SHRM/Rutgers report:

Within the manufacturing sector, this index dropped from 48.8 in July 2007 to 30.9 in July 2008. July 2007 was a month in which manufacturing employment decreased by 6,000 jobs on a seasonally adjusted basis and by 64,000 jobs on a not seasonally adjusted basis . . . Within manufacturing, the index level for July 2008 is lower than for any other July in the last five years.

The latest McKinsey Global Survey on economic conditions determined that executives in North America and Asia are the least likely to say their companies will hire over the next six months.

In most respects, McKinsey Quarterly's Economic and Hiring Outlook, First Quarter 2008 indicated that companies are less likely to increase their investments in human capital — as well as in research and development and mergers and acquisitions — than they were even three months earlier, due to gloomy economic expectations wrought by fears of inflation and continued rising business costs.

"Notably, the proportion of executives reporting that their companies will make capital investments dropped 10 percentage points in only three months," according to the recent survey.

However, human capital remains the area in which executives are "likeliest to increase investment," with nearly 40 percent saying they will.