US employers added a smaller-than-expected 113,000 new jobs in July and the unemployment rate jumped unexpectedly to 4.8 per cent, Labour Department data showed.

The report implied softening job markets that may make it easier for Federal Reserve policy-makers to decide to halt in their two-year-long campaign of interest-rate rises when they meet tomorrow.

Though average hourly earnings continued to rise last month, the unemployment rate was the highest since a matching 4.8 per cent in February and was contrary to Wall Street economists' forecasts that the rate would be unchanged from June's 4.6 per cent.

Analysts had also forecast a more robust 142,000 new jobs would be generated in July. The department revised June's new-job total up modestly to 124,000 from a previously reported 121,000 and said that in May 100,000 jobs were created rather than 92,000.

Still, average hourly earnings increased seven cents for a second straight month to £8.82 in July, a 0.4 per cent increase, the same as in June. In the year through July, average hourly earnings rose 3.8 per cent, down slightly from the 3.9 per cent year-over-year gain posted in June.

During July, the number of people looking for work and employed rose more than 200,000, one reason that the unemployment rate was up.

Manufacturing shed 15,000 jobs last month after adding 22,000 in June and goods-producing businesses overall cut 2,000 jobs after adding 23,000 in June.