WASHINGTON -- The economy's spring slump appears to be extending into the summer, according to a slew of mixed data released Thursday.
Layoffs are rising. Manufacturing activity in the Northeast expanded only slightly in July after contracting in June. Economic growth is projected to pick up this fall, but not enough to give businesses confidence to hire and speed the recovery.
The economy could lapse even further if Congress and the Obama administration do not reach agreement on raising the nation's borrowing limit by Aug. 2.
For the moment, traders on Wall Street don't seem worried.
Stocks soared Thursday on news that European governments were moving toward agreement on an aid package for Greece. The Dow Jones industrial average rose more than 150 points.
Economists are less optimistic, forecasting a third straight month of feeble hiring in July, based on the latest round of data. Expectations are that the economy will add between 50,000 to 100,000 net new jobs this month.
That's not enough to keep up with population growth, and far below what is needed to lower the unemployment rate, which was 9.2 percent last month.
"We're going to see improvement, but right now nothing's improved yet," said Joshua Dennerlein, an economist at Bank of America Merrill Lynch.
Applications for unemployment benefits rose last week by to a seasonally adjusted 418,000, the Labor Department said. They have now topped 400,000 for 15 straight weeks. Applications had fallen in February to 375,000, a level that signals healthy job growth.
The Philadelphia Federal Reserve Bank said its manufacturing index rose to 3.2 in July, a sign that the sector is growing again.
It had contracted in June for the first time in nine months when the index dropped to negative 7.7, the lowest level in two years. Any figure below zero indicates contraction.
The index had topped 40 in March. The lower reading illustrates the impact of a parts shortage caused by the Japanese earthquake, which has affected many U.S. automakers and electronics producers.
Still, manufacturers expressed some hope in the latest survey, saying they expect orders and shipments to pick up significantly six months from now.
The Conference Board also projected modest growth for the broader economy in the coming months based on its latest reading of its leading economic indicators. The index rose in June for the second straight month.
It had declined in April, the first time that had happened in nearly a year.
The private research group offered a caveat: U.S. lawmakers must agree to raise the government's borrowing limit and avoid a catastrophic default on the debt.
The federal government has reached its borrowing limit of $14.3 trillion, and the Obama administration says the government won't be able to pay all of its bills if the cap isn't raised by Aug. 2.