Economy adds 117,000 jobs as stock markets remain volatile

Volatile markets jumped up, then fell, and are now rising after a report from the Bureau of Labor Statistics showed the economy added a better-than-expected 117,000 jobs for the month of July. 

The unemployment rate ticked back to 9.1 percent, and the Labor report found the private sector added 154,000 jobs.  

The figures won't give a huge boost to confidence to the economy, but they do beat expectations. Forecasters had projected the economy would add around 75,000 jobs. 

The report kicked off a wild day for markets, which were reacting not only to conditions in the U.S. economy but to fears about the debt crisis in Europe. 

Stocks jumped in the morning, with the Dow Jones Industrial Average rising 160 points immediately after the opening bell. Markets quickly gave up those gains, and the Dow was down by 160 points just after noon. Within the hour, the Dow had swung again into positive territory for the day. 

It is another in a series of turbulent days for financial markets, which plunged Thursday on fears that the global economy is headed into a tailspin. Those fears have been stoked by a worsening debt crisis in Europe that threatens to hit both Spain and Italy, one of the eight largest economies in the world.

Falling markets and weak economic data also have raised fears that the U.S. economy is in danger of entering a double-dip recession, a possibility Sen. John Kerry (R-Mass.) raised in a Friday interview.

President Obama sought to reassure voters on the economy in remarks Friday, saying "things will get better."

"What I want the American people and our partners around the world to know is this: We are going to get through this. Things will get better and we are going to get there together," Obama said in remarks from Washington's Navy Yard.

Obama reiterated his call for Congress to extend federal unemployment benefits and a payroll tax reduction introduced this year. The GOP has been cool to both ideas, however, and House Republicans on Friday said it was time to stop spending tax dollars on efforts to stimulate the economy. 

Speaker John Boehner (R-Ohio), in a statement released just minutes after the report's release, said the figures are further proof that Washington should pivot away from "failed stimulus policies" and work for reductions in taxes and regulations that are "devastating our economy."

House Majority Leader Eric Cantor (R-Va.) said the new report is "a slight improvement from last month," but added it shows the economy is still ailing. 

He said the debt-ceiling deal signed Tuesday by Obama was "an important step forward for our country and accomplished needed reforms without raising taxes."

In an appearance on CNBC, Cantor said it was more important to focus on policies that would create jobs than on extending unemployment benefits, but he did not rule out another extension.

In addition to the 117,000 jobs the report said were created in July, the report included revised figures for May and June that show the economy added 56,000 more jobs than last forecast in those months. The initial Labor report for June suggested the economy added only 18,000 jobs that month.

Still, the economy needs to add at least 150,000 jobs per month to really dent unemployment, given population growth.

The rate of job growth will keep the economy "firmly in low gear and on track for persistent high unemployment," according to Heidi Shierholz, an economist with the Economic Policy Institute. She also noted that the slight dip in the unemployment rate was entirely due to a drop in the labor force, not an increase in the share of workers with jobs.

—This story was posted at 8:39 a.m. and last updated at 12:51 p.m.

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