Job seekers wait to talk to representatives at Michigan’s Unemployment Insurance Agency office on July 1, 2009.

Companies in the US cut fewer jobs in July as the worst recession since the Great Depression eased, a private report based on payroll data showed Wednesday.

Stabilization in housing and manufacturing and help from the federal stimulus effort will usher economic growth this quarter, economists say. Consumer spending, which accounts for 70 percent of the economy, may be slow to gain speed as home prices fall, wages stagnate and unemployment climbs.

“We’ll have a weak labor market for many, many months,” Brian Bethune, chief US financial economist at IHS

Global Insight in Lexington, Massachusetts, said before the report. “Consumers are going to be reluctant to go out and make major purchases.”

The Labor Department’s payrolls report later this week may show employers cut another 328,000 jobs in July and unemployment jumped to 9.6 percent, according to the median forecast in a Bloomberg News survey.

The economy already has lost 6.5 million jobs since the recession began in December 2007, the most of any economic slump since the Great Depression.

The ADP report was forecast to show a decline of 350,000 jobs, according to the median estimate of 30 economists in a Bloomberg survey. Projections ranged from decreases of 410,000 to 200,000.

Private only

ADP includes only private employment and does not take into account hiring by government agencies. Macroeconomic Advisers LLC in St. Louis produces the report jointly with ADP.

Employers announced 5.7 percent fewer job cuts in July than the year earlier, according to a report Wednesday by Chicago-based placement firm Challenger, Gray & Christmas Inc. Following a 9 percent drop in June, it was the first time since late 2007 that planned firings declined for two months in a row.

Wednesday’s report showed a decrease of 169,000 workers in goods-producing industries including manufacturers and construction companies. Service providers cut 202,000 workers.

Employment in construction dropped by 64,000, while financial firms decreased jobs by 26,000, ADP said.

Source: Bloomberg