WASHINGTON — Unemployment lines, painfully long this July Fourth, are only going to get longer.
The nation lost jobs for a sixth month in a row in June, a storm of pink slips drenching this year's holiday for more than 60,000 Americans and leaving thousands more worried about the future.
Weighed down by energy prices and the housing crisis, employers laid off workers in stores, factories and forsaken building sites.
With more job cuts expected in coming months, there's growing concern that many people will pull back on their spending later this year, when the bracing effect of the tax rebates fades, dealing a dangerous setback to the shaky economy. These worries are rekindling recession fears.
"The deteriorating jobs climate will dampen many a barbecue this weekend. It's hard to celebrate when you are out of a job," said Richard Yamarone, economist at Argus Research.
In June alone, employers got rid of 62,000 jobs, bringing total losses so far this year to 438,000, according to the Labor Department's report released Thursday. The economy needs to generate more than 100,000 new jobs a month for employment to remain stable.
The jobless rate held steady at 5.5 percent after jumping in May by the most in two decades. Still, June's jobless rate was considerably higher than the 4.6 percent of a year ago. And it is expected to climb through the rest of this year and top 6 percent early next year.
"The economy will get worse before it gets better," said Sung Won Sohn, an economics professor at California State University.
Just in the past few days, Chrysler LLC said it would close a plant and Starbucks Corp. said it would shut some 600 stores in the next year, meaning more lost jobs ahead.
American Airlines recently said it may cut flight attendant jobs.
When companies do have openings, job hunters are in for more competition.
"I get resumes upon resumes upon resumes when I put up job postings," said Jeff Posner, president and owner of e-ventsreg.com, a small New Jersey firm that handles registration and check-ins for trade shows.
There were 8.5 million unemployed people as of June, up from 7 million a year earlier.
Heavy job losses were reported in construction, manufacturing and financial services, the worst casualties of the housing, credit and financial debacles.
Cutbacks also came in retailing, temporary help, trucking, publishing and elsewhere. That more than swamped job gains in other places including health care, education, hotels, bars and restaurants and the government.
The economy is the top concern of voters and will figure prominently in their choices for president and other elected officials come November.
The faltering labor market is a source of anxiety not only for those looking for work but also for those worried about keeping their jobs during uncertain times.
Other weak areasOther economic news revealed more weak spots:
• The number of newly laid off people signing up for unemployment insurance rose sharply last week. New applications jumped by 16,000 to 404,000, the highest level since late March.
• The nation's service sector, generally an engine for the economy, contracted in June. The Institute for Supply Management's index of the service sector fell to 48.2 in June from 51.7 in May.
A reading below 50 signals activity is shrinking, while a reading above that suggests activity is expanding.
On Wall Street, investors took the latest batch of economic reports in stride. The Dow Jones industrials closed up 73.03 at 11,288.54.
In political circles, though, the latest news spurred calls from Democrats to take more steps to aid the economy. The Bush administration thinks the government's $168 billion stimulus effort, including the rebates, should be sufficient but hasn't ruled out further action.
With inflation concerns growing, the Federal Reserve last week ended an aggressive interest rate-cutting campaign, started last September to shore up economic growth.
Fed Chairman Ben Bernanke and his colleagues are caught between risky crosscurrents of plodding economic growth and spiraling energy and food prices. Lowering interest rates further could worsen inflation.
But boosting rates to fend off inflation could hurt the fragile economy.
Given the state of the job market and continued damage from the housing slump, the Fed probably will leave rates alone when policymakers meet on Aug. 5, some economists suggest.
On the other side of the Atlantic, the European Central Bank boosted its key interest rate Thursday in an effort to rein in escalating inflation.
In the U.S. wage growth for workers is slowing.
Average hourly earnings grew by just 3.4 percent over the past 12 months, the smallest annual increase since January 2006.
Paychecks aren't stretching as far because prices for gasoline, groceries and other things are rising more quickly.
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