By CHRISTOPHER S. RUGABER
WASHINGTON (AP) -- Unemployment rates rose in July in more than half the states for the second straight month, evidence that job growth remains weak nationwide.
The Labor Department said Friday that unemployment increased in 28 states, fell in nine and remained unchanged in 13. Those are nearly the same figures as in June, when unemployment rose in 28 states, fell in eight and was unchanged in 14.
Nationwide, hiring picked up slightly in July. The economy added 117,000 jobs, the government reported earlier this month. That was roughly double the net jobs created in each of the previous two months. And the unemployment rate dipped to 9.1 percent in July from 9.2 percent in June.
Still, hiring has slowed sharply this year - from an average of 215,000 net jobs a month from February through April to an average of 72,000 in May through July.
Growing worries that the United States could slip back into recession, combined with fears about Europe's debt crisis, have sent stocks plunging. The Dow Jones industrial average plunged 419 points Thursday. The Dow is down about 14 percent since July 21. The Dow fell further Friday, declining 20 points in mid-day trading.
The number of states reporting job gains rose to 31 in July from 26 in June. But the gains weren't always enough to lower unemployment rates in those states. An unemployment rate can increase even if jobs are added, if many more people look for work.
That's what happened in Michigan last month. It reported the third-biggest gain in jobs: 23,000. About half the gain was in government jobs, defying a nationwide trend of job cuts by state and local governments.
State officials said the gain was likely exaggerated by seasonal adjustments. Fewer school employees, for example, were laid off this summer after cuts in previous years. If seasonal layoffs are fewer than in previous years, that factor can inflate the seasonally adjusted number of new jobs.
Michigan's unemployment rate jumped to 10.9 percent from 10.5 percent, reflecting more unemployed people, even though the state added jobs. The government uses two surveys to count the number of jobs and the number of unemployed, and the two surveys can sometimes diverge.
New York enjoyed the biggest job gain in July: 29,400. The state added jobs in education and health care and professional and business services - a category that includes accounting, engineering, and temporary workers, among other professions.
Texas reported the second-most number of new jobs. It added positions in retail, transportation, education and health, and hotels, restaurants, and other leisure industries.
Texas has accounted for nearly half the U.S. jobs created since the recession officially ended two years ago, according to calculations by the Federal Reserve Bank of Dallas. Its job-creation figures are coming under scrutiny now that Gov. Rick Perry, a Republican, has launched a presidential campaign.
Illinois reported the biggest loss of jobs last month: 24,900. It was followed by Florida, with a loss of 22,100 and Minnesota, with 19,800. Many of Minnesota's job losses stemmed from the state government's shutdown last month. State agencies temporarily laid off 22,000.
Nevada had the nation's highest unemployment rate, at 12.9 percent. It was followed by California, at 12 percent.
North Dakota had the lowest rate, 3.3 percent, followed by Nebraska, 4.1 percent.
The nation's economy slowed sharply in the first half of the year, to an annual pace of only 0.8 percent. That was the slowest since the recession officially ended.
Economists had hoped the slowdown was mostly a reaction to temporary factors. They include a spike in gas prices in the spring and supply disruptions stemming from Japan's March 11 earthquake.
But now most analysts expect the weakness to persist for the rest of this year and next.
Michael Feroli, an economist at JPMorgan Chase, has dramatically lowered his forecasts for the U.S. economy. He now expects an annual growth rate of only 1 percent in the October-December quarter, down from a previous estimate of 2.5 percent.
And the economy will expand at an annual rate of only 0.5 percent in the first half of next year, down from an earlier estimate of 1.5 percent, he predicts.
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