Warm weather and deep discounts helped retailers score their best June since 1999.

Associated Press photo

NEW YORK – A rebound in retail sales and strong jobs reports pushed stocks near their highest levels of the year.

U.S. retailers had their best June sales results since 1999 as shoppers were lured into stores by warm weather and deep discounts. Kohl’s Corp., Target Corp., and Urban Outfitters Inc. each gained more than 6 percent.

Investors have been concerned that high gas prices would constrain consumer spending as people looked for ways to save money. The higher sales figures reassured markets that consumers were becoming more willing to spend again.

“The closest thing to an unadulterated barometer of our progress is same-store sales,” said Jack Ablin, chief investment officer at Harris Private Bank in Chicago. Same-store sales for the 28 retailers who reported them on Thursday were up 6.9 percent. “Everything is tied to it: Sales drives profits, profits drive hiring and hiring drives sales. It’s a neat, virtuous circle.”

An improving job market likely helped. The number of people who made first-time claims for unemployment benefits dropped last week to a seven-week low of 418,000, the government reported. That’s a sign that employers are laying off fewer workers.

Separately, payroll processor Automatic Data Processing said companies added 157,000 employees in June. The bulk of the hiring came from small businesses. The tally is more than double the number economists had forecast and far more than the 36,000 added the previous month. The report isn’t always an accurate predictor of the Labor Department’s monthly unemployment report, but has been more of a bellwether in recent months. The Labor Department’s report will be released Friday.

The Dow Jones industrial average gained 93.47 points, or 0.7 percent, to close at 12,719.49. The Standard and Poor’s 500 index added 14 points, or 1.1 percent, to 1,353.22. The tech-focused Nasdaq composite closed at 2,872.66 after gaining 1.4 percent. It briefly traded at a new high for the year of 2,877.

The Dow and S&P 500 are close to their 2011 highs, reached on April 29. Then came higher gas prices, a slowdown in manufacturing and job growth and bad weather in the South. That led to concerns that the economic recovery was stalling. At the same time, worries about a debt default by Greece also heightened fears of a European financial crisis. The Dow and S&P had six straight weeks of declines falling as much as 8 percent off their April highs. Just three weeks ago, the S&P index had given up nearly all of its gains for the year.

A rebound in a key manufacturing index and stronger sales figures from Nike Inc. and other companies pushed the index up nearly 6 percent since June 15th. Signs of a deal to help Greece avoid default and allow the country to restructure its debt also calmed financial markets. The Dow and S&P 500 are now up 2.5 percent so far this month. The Dow is up 9.86 percent for the year.

Trading has been light in the stock market this week. Markets were closed in the U.S. on Monday for the July 4th holiday. No major corporate earnings came out this week. Aluminum maker Alcoa Inc. is the first major U.S. company to report second-quarter earnings on Monday.

The Labor Department releases its closely-watched monthly employment report before the market opens Friday. Economists estimate the unemployment rate will remain at 9.1 percent and that employers added only 90,000 jobs last month. But some experts now believe that number could be higher. After the ADP figures were released, economists at Deutsche Bank raised their forecasts for the number of jobs created in June to 175,000 from 100,000.

Four stocks rose for every one that fell on the New York Stock Exchange. Volume was average at 3.6 billion shares.

The event will include hundreds of classic cars displayed on the grounds of Lenox, the saw and toolmaker.

Photo by Mark M.Murray / The RepublicanJeffrey DeMarey shows off his 1968 Ford Mustang that will be in the upcoming car show to be held at the Lenox Tools parking lot off Chestnut Street in East Longmeadow.

EAST LONGMEADOW– What started as plans for a small event to help tornado victims has turned into a show with more than 400 antique and classic cars due to be on display Saturday.

“The support has been phenomenal,” said Jeffrey DeMarey, organizer of the event and also the owner of a classic car – a 1957 Chevrolet Corvette.

The event will include hundreds of classic cars displayed on the grounds of Lenox, the
saw and toolmaker located here. DeMarey said Lenox and Blu Homes donated their lots for the event.

A “Million Dollar Circle of Cars” will be featured, which includes three Rolls Royce automobiles made in Springfield, Pierce Arrows, a Packard limousine, a 1941 Lincoln Continental and a rare 1954 Kaiser Darrin sports car. The cars are privately owned.

“We have cars coming from Connecticut, New York, Vermont Rhode Island and even Maine,” he said.

Even U.S. Sen. Scott P. Brown is getting in the act by sending his green pickup truck used during his campaign, DeMarey said.

The show will award 17 trophies – the number chosen to represent the tally of
communities affected by the tornadoes, DeMarey said. There will be a 50-50 raffle as
well, and proceeds from the event will be disbursed to assist families affected by the
June 1 tornado.

“This is a way for us to help families who are struggling after the tornado,” he said. A board of four business representatives will determine who will get the funds, DeMarey said.

De Nardo’s Pizzeria in East Longmeadow will sell food at the event as well.

The names and genders of the two victims weren't immediately available.

Republican file photo

HOLYOKE – Police are investigating a two-car head-on accident in which two people were killed late Thursday afternoon on Route 202.

The accident occured about 500 yards north of the old Apremont Highway, police said. Part of Route 202 is closed at Homestead Avenue as police investigate the accident.

The identities, genders and other details of the victims and how the accident occurred weren’t immediately available.

State police and a representative of the Hampden District Attorney's office were on the scene investigating.

Police said they will release a statement about the accident later tonight.

The 16-year-old boy was in critical condition following the 4:15 p.m. shooting, police said.

View full sizeRepublican staff photo by Patrick JohnsonA Springfield police office walks back to his cruiser on Washington Street. Behind him is the scene where a 16-year-old shooting victim had been found in the road.

This is an update of a story first posted at 5:16 p.m.

SPRINGFIELD – A 16-year-old boy was shot three times and collapsed in a Forest Park intersection Thursday afternoon after falling out of a moving car, police said.

The boy was in critical condition at Baystate Medical Center with three gunshot wounds Thursday evening, said Springfield police Lt. John M. Bobianski

His name was not being released.

The boy was found lying in the middle of the intersection of Washington and Meredith streets, off Dickinson Street in the Forest Park neighborhood, just before 4:15 p.m., Bobianski said.

His car, a silver Honda, was parked a few hundred feet up the road.

Bobianski said police believe he was shot while in the car and then either fell out or jumped. Blood was found on the driver’s seat, he said.

The car is believed to have coasted up the road and came to rest when it hit a parked car.

Police were releasing no information about possible suspects.

People who lived in the vicinity said they did not hear any gunshots leading up to the discovery of the man in the road.

One woman, who said she called 911, said she saw the man “lying on the ground and other people were trying to help him.”

She said he seemed seriously hurt but was still conscious and seemed alert.

She said she had never seen him around before.

View full sizeRepublican staff photo by Patrick JohnsonMayor Domenic J. Sarno hands out cards with Text-a-Tip information to some teens at the scene of a shooting on Washington Street. Sarno, who lives a few blocks away, was heading home to his family when he saw all the police cars.

Another woman who lives near the intersection said she was taking a nap and did not hear anything thing. She said she did not know anything had happened until she woke to see all the police cars outside her window.

Springfield Mayor Domenic J. Sarno arrived on the scene shortly after 5 p.m. and was appraised of the shooting by police.

Sarno, who lives a few blocks away, said he was on his way home to have dinner with his family when he saw all the police cars.

The mayor said he was sick of the repeated flare-ups of violence in the city.

The city tallied its 9th homicide four days earlier when 38-year-old Raul E. Vera was found shot to death on Lincoln Street.

As people assembled outside the lines of police tape, Sarno walked around to hand cards containing information on the Text-A-Tip program.

People who wish to make anonymous tips to police can use their cell phones to text information to Springfield police via Text-A-Tip by addressing a text to “CRIMES,” or 274637, and then beginning the body of the message with the world “SOLVE.”

People can also contact the Springfield Detective Bureau by calling (413) 787-6355.

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Sarno has criticized the council's budget cuts, saying they were irresponsible.

File photos | The RepublicanSpringfield City Councilors Timothy Allen (top row, left), Michael Fenton (top right), John Lysak (bottom left) and Kateri Walsh (bottom right) at a press conference defended their decisions to cut $2.7 million from the fiscal 2012 Springfield budget submitted by Mayor Domenic Sarno.

SPRINGFIELD – City councilors portrayed themselves Thursday as protectors of the city’s reserve funds and as responsible fiscal managers in response to the mayor’s criticism of budget cuts totaling $2.7 million.

In a press conference at City Hall, four councilors took turns reading from a three-page statement, defending the cuts, and invited Mayor Domenic J. Sarno to attend a council Finance Committee meeting next week to discuss the budget and related issues.

Sarno declined the invite, saying his “complete focus” is on rebuilding Springfield in the aftermath of the June 1 tornado. His finance team will attend, he said.

Sarno said last Friday that the budget cuts were irresponsible and potentially damaging to the city. The cuts include the layoff of 10 additional employees, reduced maintenance of vehicles and equipment and reduced mowing.

Councilors said the cuts were reasonable, and will help keep a sufficient amount of funds in the city’s stabilization “rainy day” reserve fund. The mayor was seeking to take $10.5 million from the stabilization fund to help balance the budget, an amount rejected by the council.

The reserve fund now totals $43.7 million, but councilors said the city faces millions of dollars in expenses from the tornado and a prior harsh winter, even with expected state and federal aid.

“We believe an important part of our job is to provide fiscal oversight and to protect our savings,” the council statement read.

Councilors said they hope their 5 percent cut in all non-salary accounts, totaling $1.7 million, can leave the highest priority items intact.

Councilors attending the press conference were Michael A. Fenton, Timothy C. Allen, Kateri B. Walsh, and John A. Lysak. Fenton, finance committee chairman, said some other councilors also supported the statement but were unable to attend the press conference.

Fenton and council president Jose Tosado previously defended the cuts, saying the cuts were reasonable and necessary in difficult financial times.

The Finance Committee plans to meet Tuesday at 5:15 p.m., at City Hall, and Fenton said he does not understand why the mayor had time for a press conference on the budget cuts last Friday, but no time to meet with the council.

Domenic J. Sarno

Sarno said he looks forward to working with the council.

During their press conference, councilors also defended an increase in their salary, from $13,050 to $14,500.

Fenton and Allen said the council was returning to its former salary after taking a voluntary pay cut for four years, and that it was the mayor who recommended the salary in his proposed budget.

The city budget, after the council cuts, is $542.2 million and took effect July 1.

The Finance Committee next week will discuss the mayor’s proposal to increase the hotel/motel tax and increase the city’s demand fee for delinquent taxpayers.

The councilors also said they disagree with Police Commissioner William J. Fitchet’s decision to lay off four police cadets in response to an approximate $101,000 cut from the police salary account. The councilors instead wanted the funds cut from two vacant clerical positions, but Fitchet said he needed to fill the vacancies, officials said.

NASA is closing out its 30-year space shuttle program to take aim at asteroids and Mars.

By MARCIA DUNN | AP Aerospace Writer

View full sizeAssociated PressThe space shuttle Atlantis sits on the launch pad as a rain cloud passes at the Kennedy Space Center Thursday, July 7, 2011, in Cape Canaveral, Fla. Atlantis is scheduled to launch on Friday, July 8 and is the 135th and final space shuttle launch for NASA. (AP Photo/Terry Renna)

CAPE CANAVERAL, Fla. — Rain in the forecast threatened to delay the last space shuttle launch, set for Friday, and a lightning strike near the pad briefly caused a flurry of concern at NASA before engineers concluded the spaceship was OK.

The lightning bolt hit a water tower about 500 feet from the launch pad at midday Thursday, the space agency said. Technicians hurried out to check for electrical problems, but a review board ruled out any damage.

Over the years, lightning has struck on or near the launch pad occasionally, delaying a few launches but causing no damage.

The forecast for Friday, meanwhile, looked dismal, with only a 30 chance of acceptable weather at launch time, 11:26 a.m.

NASA test director Jeff Spaulding pointed out that space shuttles have managed to launch with worse forecasts.

"There's some opportunity there," he said Thursday as the rain set in. "It's a really tough day if you make a decision not to go and it turns out to be good weather."

NASA is closing out its 30-year space shuttle program to take aim at asteroids and Mars, destinations favored by the White House. Private companies will take over the job of hauling cargo and crews to the International Space Station, freeing NASA up to focus on points beyond.

"We believe that on behalf of the American people, it is time for NASA to do the hard things to go beyond low-Earth orbit," NASA's deputy administrator, Lori Garver, told reporters gathering for the launch.

The odds of good flying weather improve with each passing day, said shuttle weather officer Kathy Winters. The launch time moves slightly earlier every day, and that helps, she said.

NASA has until Sunday, possibly Monday, to get Atlantis and its four astronauts in orbit. Otherwise, the spacecraft will remain grounded until the following weekend because of an Air Force rocket launch that takes priority.

Rain or shine, hundreds of thousands of people are expected to jam the area for the launch. Some estimates put the crowd at close to 1 million. Dozens of astronauts already are in town, including the very first shuttle pilot Robert Crippen, who opened the era aboard Columbia in 1981.

"It's a sad time for me obviously. But it's also a time when I feel pride. I'm proud of what the shuttle has done," Crippen told The Associated Press. "You've got to get it back down on the ground safely. So when we finally get 'wheels stop,' it will be an emotional moment for me."

The commander of that original shuttle shot, moonwalker John Young, opted to stay home in Houston. He didn't want to deal with all the fuss, Crippen explained. "It's not his kind of thing," he said. "He'll watch it on TV," he said.

Along one of the main roads leading into Kennedy Space Center, businesses and even churches joined in the celebration with billboards pronouncing "God Bless Atlantis July 8" and "Godspeed Atlantis and Crew."

The countdown, at least, was going well, with only a few minor technical problems at the pad reported.

Atlantis is bound for the International Space Station with a year's worth of provisions. NASA wants the orbiting outpost well-stocked in case there are delays in getting commercial cargo hauls started. The first privately operated supply run — by Space Exploration Technologies Corp. — is tentatively scheduled for late this year.

NASA payload manager Joe Delai got emotional as he showed pictures of the 21-foot-long, shiny metal cargo carrier in Atlantis' payload bay. That massive bay is the one thing that none of the smaller follow-on craft will have.

"This is just beautiful ... It's not a piece of metal. It's a way of life," he said. "We're just inches into what we know, and everything we do now is what I consider the foundation for human spaceflight.

"Yeah, it's emotional, but it's also part of history. I think that's what you're seeing from a lot of folks down here."

Also aboard Atlantis: multiple sets of patches and pins representing all 135 shuttle missions, as well as thousands of shuttle bookmarks for children. The patches and pins will be presented to schools following the flight, Delai said.

The 12-day voyage by Atlantis should culminate with a touchdown back at Kennedy on July 20, the 42nd anniversary of man's first steps on the moon.

"There's an old saying that says it's better to travel well than to arrive," Spaulding said. "And I'd have to say after the last 30 years, certainly our program and these shuttles, throughout all of their missions, have traveled very well. And after 135's landing, I think we can say at that point that we've arrived."

Rep. Dennis Kucinich, D-Ohio: "This is our moment to reclaim the Constitution of the United States."

Associated PressA street vendor talks to customer in a street market in the rebel-held Benghazi, Libya, Thursday, July 7, 2011. NATO denied a Libyan government charge Thursday that the alliance is intentionally using its airstrikes to assist rebel advances, saying it is sticking to its mandate to protect civilians. (AP Photo/Sergey Ponomarev)

By DONNA CASSATA

WASHINGTON — The House voted Thursday to bar military aid to Libyan rebels battling Moammar Gadhafi but stopped short of prohibiting funds for U.S. involvement in a NATO-led mission now in its fourth month.

Sending a muddled message in the constitutional challenge to President Barack Obama, House Republicans and Democrats signaled their frustration with American participation in a stalemated civil war but also showed their unwillingness to end the operation.

The congressional unrest stems in large part from Obama's decision not to seek congressional consent for a third war in addition to years-long conflicts in Iraq and Afghanistan.

"Congress has allowed the president to overreach in Libya," said Rep. Tom Cole, R-Okla. "We should not be engaged in military action of this level unless it is authorized and funded by Congress."

The House voted 225-201 for an amendment sponsored by Cole to bar the Pentagon from providing "military equipment, training or advice or other support for military activities," to an outside group, such as rebel forces, for military action in or against Libya.

Forty-eight Democrats backed the Republican-sponsored measure.

The intent of the measure is to prohibit aid to the rebels such as weapons and assistance to their Transitional National Council, including operational planning. The broad effort also would target contractors in Libya.

In fact, Obama has authorized $25 million in nonlethal assistance to the rebels, including thousands of meals ready to eat from Pentagon stocks. The U.S. has also supplied some $53 million in humanitarian aid. Neither would be affected by the bill.

Moments after the vote, the House rejected a measure that would have prohibited funds for the U.S. military to continue its limited role. The vote was 229-199, with 67 Democrats breaking with the administration to support the amendment.

"This is our moment to reclaim the Constitution of the United States," said Rep. Dennis Kucinich, D-Ohio, who co-sponsored the amendment with freshman Rep. Justin Amash, R-Mich. "We have the power to determine when to go to war, not some rebel power in Benghazi."

Lawmakers argue that Obama violated the 1973 War Powers Resolution, which requires a president to seek congressional approval within 60 days of the first military strikes, a move the commander in chief did not make. Instead, Obama informed Congress last month that such assent was unnecessary because the limited U.S. role does not rise to full-blown hostilities.

Incensed House Republicans and Democrats voted overwhelmingly last month to deny Obama the authority to continue the mission, a largely symbolic vote that was still a rebuke to the president. But they stopped short of cutting off funds for the operation, a mixed message from the House.

In a reflection of congressional anger toward the administration, the House voted overwhelmingly for an amendment that prohibits spending that violates the War Powers Resolution and focuses on future military operations. The vote was 316-111, and represented a spike in opposition in a matter of weeks.

The same amendment by Rep. Brad Sherman, D-Calif., to a military construction bill last month had been adopted 248-163.

The House also rejected two other efforts to prohibit funds for the U.S. military operation in Libya.

The votes Thursday ratcheted up the pressure on the administration as Libya remained a stalemate between Gadhafi and rebel forces, and war-weary NATO allies signaled their patience was wearing thin. Italy announced that it was reducing its participation in NATO's campaign by removing an aircraft carrier from the region and pulling thousands of troops home.

Opponents of the amendments, such as Rep. Norm Dicks, D-Wash., argued that the United States should be allowed to continue the mission along with its NATO allies. He reminded Republicans that President Ronald Reagan had challenged Gadhafi, and the U.S. should finish the job.

Associated PressJohn McCain

Sen. John McCain, the top Republican on the Armed Services Committee, criticized the House vote on aid to the rebels, arguing that it sends the wrong message to Gadhafi and those challenging the long-time leader.

"I am saddened by the abandonment of America's traditional support for those struggling for freedom and democracy, which has been a hallmark of our Republican Party for decades," said the Arizona Republican, who traveled to Benghazi in April to meet with the rebels.

The House considered the amendments as part of a $649 billion defense spending bill that wouldn't go into effect until Oct. 1. The defense bill includes no money for the Libyan operation; the Pentagon has said it could cover the expense with existing funds.

Last month, the White House put the cost of U.S. military operations in Libya at about $715 million, with the total increasing to $1.1 billion by early September.

Since NATO took command of the Libya operation in early April, the U.S. role has largely been limited to support efforts such as intelligence, surveillance and electronic warfare. The U.S. has launched airstrikes and drone attacks, flying more than 3,400 sorties.

The Senate has delayed consideration of a resolution authorizing the U.S. mission in Libya.

Earlier in the day, the House rejected several amendments that would have accelerated the withdrawal of U.S. forces from Afghanistan as Republicans and Democrats argued that the nation can't afford a conflict now in its 10th year.

Obama has ordered a reduction in the force by 10,000 by year's end and 23,000 troops to be withdrawn by September 2012.

There are about 100,000 U.S. troops in Afghanistan as part of an international coalition.

Reflecting the desire for budget cuts, the House narrowly approved an amendment by Rep. Betty McCollum, D-Minn., to cut $124.8 million from the budget for military bands. The vote was 226-201. A day earlier, the House had added the money by voice vote.

The House was intent on completing the defense bill by week's end. The overall measure is $9 billion less than Obama sought but $17 billion more than current levels.

The administration has threatened a veto if the legislation is unchanged, citing provisions limiting the president's authority to transfer terror suspects from the U.S. naval facility at Guantanamo Bay, Cuba, and a prohibition on increasing enrollment fees for health care for military retirees.

"If a bill is presented to the president that undermines his ability as commander in chief or includes ideological or political policy riders, the president's senior advisers would recommend a veto," the administration said in a statement last month.

The Senate still must craft its version of the bill and then reconcile it with the House measure.

Decareau, who is already in custody in connection with multiple bank robberies, will be charged with one more, a May 27 bank job in Ludlow

Photo courtesy of the Lawrence Eagle-TribuneChristopher Decareau appears in Lawrence District Court for his arraignment on June. 2

LUDLOW - A 26-year-old Peabody man who was arrested in early June for a string of bank robberies in the eastern part of the state has been identified as the suspect in a May 27 robbery of the Chicopee Savings branch at 477 Center St., police said.

Ludlow Det. Sgt. Thomas Foye said Thursday night that Ludlow police intend to file charges against Christopher Decareau for the robbery.

Decareau is already in custody at Essex County Correctional Facility as he awaits trial for multiple counts of bank robbery in Lynnfield, Salem, Canton, Braintree, Everett, Reading and Melrose between April and May.

Andover and state police and members of the FBI Violent Crimes Task Force arrested Decareau and his girlfriend, Jenifer Sannizzaro, 24, of Gloucester, as they prepared to rob a bank in that community, according to FBI officials.

According to the Lawrence Eagle-Tribune, the couple had their 2-month-old baby with them when they were apprehend.

Foye said he was contacted by law enforcement officials that Decareau may be a suspect in the May 27 bank robbery in Ludlow.

View full sizeL: Ludlow police photo, r: Mass. Bankers AssociationThe image on the right is a Chicopee Savings Bank security photo of a suspect in a May 27 robbery. The image on the right is the same suspect robbing a Citizens Bank branch in Braintree 2 hours later. Police contend each person is 26-year-old Christopher Decareau who is under arrest for multiple bank robberies primarily outside of Boston.

Foye said mugshots of Decareau resembled security footage from the Chicopee Savings Bank robbery, and when he want to the Essex jail to interview him, Decareau confessed to robbing the Ludlow bank.

Foye said Decareau will eventually be arraigned in Palmer District Court, but not until
after court proceedings against him in Essex County are completed.

Foye said Decareau told him he had “no rhyme or reason” for robbing a bank in Ludlow.

He is from eastern Massachusetts and all of his robberies have been at that end of the state.

“He said he woke up one day and drove west on the pike, got off in Ludlow and - bang - there’s Chicopee Savings right there off the turnpike,” Foye said.
The amount he made off with from Chicopee Savings was never disclosed publicly.

Foye said Decareau told him he felt the amount taken was “not enough because two hours later he robbed a Citizens Savings Bank branch in Braintree.

In that robbery, surveillance footage shows Decareau wearing the same hat and t-shirt that he wore at Ludlow. Foye said when he first saw the pictures from Cambridge, he thought he was looking at the Chicopee Savings bank photos.

Campos, 28, of Springfield, was serving 630 days for distribution of cocaine with intent to distribute. He was eligible for a parole hearing on Nov. 4,

SPRINGFIELD - Authorities are searching for a 28-year-old inmate who walked away from the minimum security Western Massachusetts Correctional Alcohol Center sometime Thursday night, according to Richard McCarthy, spokesman for the Hampden County Sheriff's Department.

Steven Campos, 28, of Springfield, was serving 630 days for distribution of cocaine with intent to distribute. He was eligible for a parole hearing on Nov. 4, McCarthy said.

Campos is 5 feet, 9 inches tall, weighs 150 pounds, and has black hair and brown eyes.

He was noticed missing at 10:15 p.m. during a regular head count, McCarthy said.

The Sheriff's Department Apprehension Squad and the Springfield police are searching for Campos in Springfield.

The Western Massachusetts Correctional Alcohol Center serves the four western counties. Formed in 1985, it was originally planned for the treatment of people with multiple drunken driving arrests. It has since been expanded to include treatment of those with addiction problems.

People with information about where Campos is may call the Springfield Police Detective Bureau at (413) 787-6355. Those who wish to remain anonymous may text a tip via a cell phone by addressing a text message to “CRIMES,” or "274637," and then beginning the body of the message with the word "SOLVE."

7 people, including 2 children, were killed; the suspect then led police on a high-speed chase through downtown Grand Rapids before taking 2 hostages.

Associated PressPeople react near the scene in Grand Rapids, Mich. where three bodies were found Thursday, July 7, 2011. Police say seven people have been fatally shot at two locations in the western Michigan city and the victims include a child. (AP Photo/The Grand Rapids Press, Chris Clark)

» Photo gallery from The Grand Rapids Press

By TOM COYNE

GRAND RAPIDS, Mich. — A gunman opened fire in two Michigan homes Thursday, killing seven people before leading police on a high-speed chase through downtown Grand Rapids and taking two hostages in another home, authorities said.

Within hours, dozens of officers with guns drawn had cordoned off a neighborhood near a small lake in the northern part of the city and shut down nearby Interstate 96. With the man surrounded, state police warned residents to stay in their homes.

Grand Rapids Police Chief Kevin Belk said officers were communicating with the suspect, 34-year-old Rodrick Shonte Dantzler, who released one of two hostages, a 53-year-old woman, amid negotiations with officers Thursday night.

The manhunt for Dantzler began after four people were found dead in one home and three were found in another across town. Belk said two of the victims were children.

"At this point, we don't know the motive," Belk said late Thursday, but added that Dantzler did have a prior relationship with at least one person at each shooting location.

At one point during the police chase, the suspect crossed a wide grassy median on the interstate and drove the wrong way down the highway while more than a dozen squad cars pursued him. The highway remained closed hours later.

Two other people were shot when the suspect fired at police during the chase, but their wounds were not considered life-threatening. Some of the gunshots struck the windshield of a police cruiser in downtown Grand Rapids. No officers were hurt, Belk said.

Records show Dantzler was discharged from state prison in 2005 after serving time for assault less than murder. A spokesman for the prison system said he had not been under state supervision since then.

Sandra Powney lives across the street from one of the homes where the shootings happened and said she had seen Dantzler at the ranch house, where a couple has lived for more than 20 years with two adult daughters.

Powney said she had been at home all day and did not realize anyone had been killed until police converged on the cul-de-sac in the midafternoon.

"For a while we couldn't come outside," she said. "They didn't know if there was someone still inside the house."

Neighbors said police converged on Dantzler's home after the shootings a few miles away.

Sonia Bergers said Dantzler lived in the home with a woman she assumed was his wife and their daughter, a girl who appeared to be about 10 years old.

Mary Lahuis said she and her husband had returned home after having coffee at a nearby fast-food restaurant.

"We were in the house, and police went down our street, running with guns," she said. "They told us to get in the house."

Of Dantzler she said: "You would see him going up and down the street. And you'd hear him going up and down the street."

Lisa Schenden lives with her husband and their children, ages 11 and 8, two blocks from the home where four people were killed. She said the homeowners are a couple whose daughter has a daughter with the suspect.

Schenden said she did not hear the shooting either, but she saw the suspect and his daughter drive up to the house earlier in the day.

"Just last night, my kids went over there swimming, and I went over with them," she said.

Associated Press writers Corey Williams and David N. Goodman in Detroit contributed to this report.

JPMorgan Chase & Co. admitted one of its divisions rigged dozens of bidding competitions to win business from state and local governments.

Associated PressThe headquarters for JPMorgan Chase & Co., left, is shown in New York.

BOSTON — Massachusetts is to receive about $2 million of a $211 million settlement that JPMorgan Chase & Co. has agreed to pay after admitting one of its divisions rigged dozens of bidding competitions to win business from state and local governments.

The state Attorney General's office says widespread price-fixing and bid-rigging deals allowed the bank to see competitors' offers to municipalities and nonprofits investing money raised from bond offerings.

Banks compete for municipalities' business by submitting the best yield they can offer.

Authorities allege the bid-rigging deprived governments of a true competitive process that would produce the best returns on their investments.

JPMorgan Chase agreed to pay $92 million to local governments and nonprofits in 24 states to repay for the artificially low rates of return or high rates of interest the investors paid.

Federal officials say Northeast Utilities' proposed $4.66 billion purchase of NStar will not hinder competition, increase rates or weaken regulation.

By STEPHEN SINGER | AP Business Writer

HARTFORD, Conn. — Federal officials have approved Northeast Utilities' proposed $4.66 billion purchase of a Massachusetts electric and gas utility, saying the massive deal will not hinder competition, increase rates or weaken regulation.

The deal, which was approved by the Federal Energy Regulatory Commission on Wednesday, must still be approved by Massachusetts regulators who are reviewing the proposal.

The federal approval is a boost to the deal, representatives of the two companies said Thursday.

"It's an important step along the way," said Michael Durand, a spokesman for NStar, based in Boston.

The deal is among the largest in the utility industry in New England and would form the region's biggest utility company. It has become an easy target for industry rivals, environmentalists and others taking part in regulatory proceedings in Massachusetts.

Connecticut regulators have refused to take up the matter, prompting the state's chief consumer advocate to go to court to try to force the Department of Public Utility Control to review the deal.

FERC said in its 35-page decision that it reviewed the proposed deal's impact on competition, rates and regulation. The agency said the deal will have no adverse effect on competition and that it will have a minimal impact on market concentration in New England.

Northeast Utilities owns or controls about 1,300 megawatts, which FERC said is less than 4 percent of total generation in the region. NStar has divested all of its generation, the federal agency said.

Federal regulators also said the utilities' application does not indicate that customer rates will increase as a result of costs related to the deal.

And FERC said it sees no evidence that state or federal regulation will be impaired by the utility deal. The merger "will not create a regulatory gap" at the federal level because the commission will keep its regulatory authority over the companies after the deal goes through, if it is approved by Massachusetts, federal regulators said.

Jonathan Peress, director of the Clean Energy and Climate Change program at the Conservation Law Foundation in Boston, said the group has questions about how the merger will be comply with standards for review imposed by Massachusetts. State standards for review of the deal will consider its impact on renewable energy, energy efficiency and other matters, he said.

"The Massachusetts review will be a more rigorous standard," Peress said.

Reducing greenhouse gases falls heavily on the electricity generating industry and regulators' review "must recognize this new reality," the Massachusetts Department of Energy Resources has said.

Power generators have told Massachusetts regulators they worry about the possibility of a huge new competitor if the new and larger utility returns to generating, which it ended years ago with the industry's restructuring. Energy retailers are concerned that the new Northeast Utilities will use ratepayer money to invest in new projects, gaining an unfair competitive advantage by shielding shareholders from risk.

David D. Grumhaus Jr., portfolio manager at Copia Capital in Chicago, said Thursday the deal has not drawn controversy at the federal level because Northeast Utilities and NStar do not generate electricity and as a result do not pose any risk of establishing a monopoly.

"Where we've seen FERC be a little involved is in generation or monopolies or transmission," he said. "Here, where you're slamming two transmission and distribution companies together they still need to approve it but I don't think there's much to do."

Belchertown officials hope to call a special Town Meeting in August to seek authorization to borrow the money for roads and other improvements.

File photo | The RepublicanThe administration building at the former Belchertown State School.

BELCHERTOWN – Plans for building an assisted living facility at the former Belchertown State School property may depend on the town’s willingness to pay for infrastructure improvements by borrowing against future taxes on the property.

Town officials hope to call a special Town Meeting in August to seek authorization to borrow the money for roads and other improvements.

Town construction of the infrastructure would make this project viable, said William A. Terry, chairman of the Belchertown Economic Development Industrial Corp., which owns the property and has the responsibility for attracting commercial development.

Terry said the town EDIC, Board of Assessors and Board of Selectmen have agreed to town construction of the infrastructure with money borrowed under terms of a state program that allows 75 percent of the anticipated property taxes for the first 20 years after the development to be used to pay off the bonds.

Town Meeting approval is required for such a bond program.

Town Meeting gave approval for such a bond process for commercial construction of the entire Belchertown State School campus four years ago, when the town was negotiating with potential master developer Paul T. McDermott, but Terry said those terms are no longer valid.

The town is now working with Weston Solutions Inc., a development company that has in turn been working with the potential developer of the assisted living center.

Weston Solutions has agreed to clean asbestos and other contaminants from the site for the assisted living center and to bring development to the entire former state school campus on a piece by piece basis.

Terry said Weston Solutions is not disclosing the name of the company that would build the assisted living center but has guaranteed that it is a major national company with experience building and running such facilities.

This project would require a building of about 180,000 square feet, which would be near the former state school administration building and Foley Field.

Full details of the project and the proposed bond issue would be released and discussed at a public hearing prior to any vote at Town Meeting.

Terry said the construction of an assisted living center would prompt potential developers of other commercial properties to work with Weston Solutions, which has recommended a mix of businesses with small residential units.

Terry said Weston Solutions has experience cleaning contaminated properties and making them available for development and has committed to spend up to $2 million cleaning the site.

The town EDIC has sold most of the property it owned with frontage on town and state roads. Terry said that to bring commercial development to the interior sections of the property the town has to spend money for roads, water, sewer and other improvements.

To keep this project moving, Terry said, the EDIC will meet weekly. It used to meet twice a month.

Kevin Lucey, whose son took his life after a tour of duty in Iraq, is pleased with Barack Obama's decision to send condolence letters to families of troops who commit suicide.

File photo | The RepublicanKevin Lucey

BELCHERTOWN – President Barack Obama’s offer to send condolence letters to families of soldiers who commit suicide is a step in the right direction, said the father of Cpl. Jeffrey M. Lucey, a Marine who took his own life after returning home from Iraq.

In a break from past policy, Obama announced this week that he will begin sending letters to the families of military personnel who take their own lives while serving in war zones overseas.

“They didn’t die because they are weak,” Obama said, “and the fact that they didn’t get the help they needed must change.”

Kevin P. Lucey said Thursday that Obama’s message is a major change from the one on the shirt his son wore after returning from Iraq in 2003. On the front of the shirt was the word “Marines,” Lucey said. On the back, it said “Pain is weakness leaving the body.”

“This is a huge step in addressing the stigma (of seeking help for mental health issues),” Lucey said. “The president says this is a wound of war.”

Jeffrey Lucey feared to admit that he needed help for his Post Traumatic Stress Disorder when he got home from his tour of Iraq in 2003. As his family later learned, he witnessed some horrors there that would haunt him for the rest of his days. Lucey carried with him a tiny American flag he had found in the fist of an Iraqi boy who had been shot to death in the streets of Nasiriyah. He also told his sister he had been ordered to execute two captured Iraqi soldiers. The Marines Corps says it has found no evidence of this.

After coming home to Belchertown, Jeffrey Lucey began drinking. He was reluctant to seek treatment for his mental health problems, his father said, because Jeffrey was afraid it would hurt his chances to become a state police trooper. Nonetheless, he was admitted to the Veterans Affairs Medical Center in Leeds in May 2004. The VA discharged Lucey four days later after diagnosing him with alcoholism and mood swings. Jeffrey Lucey hanged himself in the basement of his parents’ home on June 22, 2004. He was 23.

The family sued the U.S. government for wrongful death. The case settled out of court for $350,000 and a promise by the government of significant improvements in suicide prevention at the VA. Still, the Luceys pressed the government to put more effort into addressing military suicide. In a column published in The Republican on Veterans Day 2010, Kevin and Joyce Lucey took Obama to task, saying he “refuses to acknowledge the sacrifices of those who fell to the hidden psychological wounds of war.”

Now that the President has done so, Kevin Lucey said it is “bittersweet,” in part because the letters will be sent only to the families of those who killed themselves in war zones and will not address past military suicides.

“It’s good as long as they can start giving fast and effective service to the families that have followed us,” Kevin Lucey said. “I thank him for it.”

Lucey spoke about the condolence letters during an interview with Amy Goodman on her radio show “Democracy Now.” The family has been outspoken on the issue of military suicide in the years since Jeffrey’s death, taking part in Military Families Speak Out.

Kevin Lucey credited that organization as well as the American Legion and the Jeffrey Lucey Chapter of Veterans for Peace for keeping the subject in the public spotlight. The Veterans For Peace chapter, which is located on Cape Cod, renamed itself for Jeffrey Lucey in March and has dedicated its efforts to addressing suicide in the military.

According to a U.S. Army survey, 22 soldiers per 100,000 take their own lives in that branch of the military. The Navy and Air Force have also reported an increase in the rate of suicide in recent years. The Marine Corps says suicides have dropped there since 2009.

Dantzler killed his daughter, ex-girlfriend and 5 other people before leading police on a high-speed chase through Grand Rapids and taking hostages inside a stranger's home.

Associated PressGrand Rapids Police investigate the scene on Knapp Street near James Ave. Thursday, July 7, 2011, in Grand Rapids, Mich. Grand Rapids Mayor George Heartwell says seven people have been fatally shot in related shootings at two homes in the southwest Michigan city and police are searching for a suspect. (AP Photo/The Grand Rapids Press, Cory Morse)

» Photo gallery from The Grand Rapids Press

Updates a story posted Thursday at 11:18 p.m.

By TOM COYNE

GRAND RAPIDS, Mich. — A gunman opened fire in two Michigan homes Thursday, killing his daughter, ex-girlfriend and five other people before leading police on a high-speed chase and taking hostages inside a stranger's home.

The five-hour standoff ended when he killed himself as authorities were telling him how to surrender.

The hostages were released unharmed, and 34-year-old Rodrick Shonte Dantzler died at the scene of a self-inflicted gunshot wound to the head, police said.

The manhunt for Dantzler began earlier in the day after four people were found dead in one Grand Rapids home and three were discovered in another across town. Two of the dead were children.

"It makes no sense to try to rationalize it, what the motives were," Police Chief Kevin Belk said. "You just cannot come up with a logical reason why someone takes seven peoples' lives."

Associated PressRodrick Shonte Dantzler

Following the discovery of the bodies, Dantzler led officers on a high-speed chase, crashed his car and took hostages he did not know inside a random home, police said. Dozens of officers with guns drawn cordoned off a neighborhood near a small lake in the northern part of the city and shut down nearby Interstate 96.

During the standoff, Dantzler fired sporadically at officers and inside the house. He vacillated between threatening to shoot the hostages and pleading with police to take him out, even asking negotiators whether there were snipers outside the home and where he should stand, Belk said.

But he changed course after several hours and asked how he could surrender. Belk said officers were talking with him on the phone about how to turn himself in when they heard the gunshot.

"At the time the incident occurred, he was talking about coming out, giving himself up," Belk said. "Obviously he decided at the last moment to fire the gun."

The names of the dead were not immediately released. Autopsies were scheduled for Friday.

Records show Dantzler was released from state prison in 2005 after serving time for assault less than murder. A spokesman for the prison system said he had not been under state supervision since then.

At one point during the police chase, Danztler drove an SUV across a wide grassy median on the interstate and then went the wrong way down the highway while more than a dozen squad cars pursued him. Belk said he crashed the vehicle while driving down an embankment into a wooded area of the highway, which remained closed hours later.

Two other people were shot when Dantzler fired at police during the chase, but their wounds were not considered life-threatening. One man was injured in what Belk described as a "road rage" attack after Dantzler fired through the rear window of the vehicle. A woman was hit in the arm in a separate shooting.

Carrie Colacchio lives a little more than a mile away from the hostage situation and said she was driving in the area when the suspect's vehicle blew through.

"I look in my rearview mirror and see this big white SUV coming up behind me," she said. "The only way to get out of it was to push the gas pedal."

She couldn't turn off the road or slow down or go any other way and reached about 85 mph.

"I almost got smacked," she said. "I had to go up on the curb."

Neighbors said police congregated at Dantzler's home a few miles away after the shootings.

Sonia Bergers said Dantzler lived with a woman she assumed was his wife and their daughter, a girl who appeared to be about 10 years old.

Mary Lahuis and her husband had just returned home after having coffee at a nearby fast-food restaurant when police began running down their street with guns, yelling at people to get in their homes.

Of Dantzler she said: "You would see him going up and down the street. And you'd hear him going up and down the street."

Sandra Powney lives across the street from one of the homes where the shootings happened and said she had seen Dantzler at the ranch house, where a couple has lived for more than 20 years with two adult daughters.

Powney said she had been at home all day and did not realize anyone had been killed until police arrived at the cul-de-sac in the midafternoon.

"For a while we couldn't come outside," she said. "They didn't know if there was someone still inside the house."

Lisa Schenden lives with her husband and their children two blocks from the home where four people were killed. She said the homeowners are a couple whose daughter has a daughter with the suspect.

Schenden said she did not hear the shooting either, but she saw the suspect and his daughter drive up to the house earlier in the day.

"Just last night, my kids went over there swimming, and I went over with them," she said.

Outside the two-story, wood-sided home where the three people were killed, neighbors stood in clumps Thursday evening, quietly talking as investigators scoured the house. As officers left, people disappeared indoors and a single police car remained on the block.

The only indication of anything unusual was three bouquets of flowers on the porch steps.

Associated Press writers John Flesher and Kathy Barks Hoffman in Grand Rapids and Corey Williams and David N. Goodman in Detroit contributed to this report.

Messina says he should be entitled to at least part of the $2 million reward.

AP Photo/WBUR 90.9, FileThis undated file booking photo, obtained by WBUR 90.9 - NPR Radio Boston, shows Boston mob boss James "Whitey" Bulger, who was captured on June 22, 2011, in Santa Monica, Calif., after 16 years on the lam.

BOSTON — A Las Vegas man who says he spotted James "Whitey" Bulger in Santa Monica, Calif., three years ago and called "America's Most Wanted" is angry that the FBI apparently ignored his tip.

Keith Messina tells the Boston Herald that all he wants from the FBI is an acknowledgment that he called in a tip after spotting a man he thought was Bulger while vacationing with his family in June 2008.

Bulger, a Boston mob moss and FBI informant, was caught in Santa Monica last month 16 years after he went on the run. He was wanted in connection with 19 murders.

Messina says he should be entitled to at least part of the $2 million reward the FBI says is going to a woman from Iceland.

The FBI had no comment.

President Barack Obama and congressional negotiators are looking at closing some tax loopholes and cutting popular social benefit programs.

Associated PressPresident Barack Obama talks about the ongoing budget negotiations, Thursday, July, 7, 2011, in the briefing room at the White House in Washington.

WASHINGTON — With an August deadline for a budget deal to raise the nation's debt ceiling looming, President Barack Obama and congressional negotiators are looking at closing some tax loopholes and cutting popular social benefit programs as they work to reach an agreement between Republicans and Democrats.

With the two sides still far apart, Obama has called everyone back to the White House for a rare Sunday meeting.

The president met with the eight top Republican and Democratic congressional leaders for an hour and a half Thursday, hoping to bridge ideas held by the two sides — each considered untenable by the other. On Capitol Hill, Democrats appeared especially rattled that the discussions included proposals to cut spending for Social Security as well as Medicare and Medicaid.

House Democratic leader Nancy Pelosi opposes cutting the benefit programs and will have an opportunity to raise her concerns when she meets Friday with the president.

"We are not going to balance the budget on the backs of America's seniors," Pelosi said.

After dragging on for weeks, the top-level talks have entered a suspenseful endgame. The shape of an agreement remains in doubt as the nation moves closer to an Aug. 2 deadline to raise the government's debt ceiling.

Obama pushed for an ambitious deficit reduction plan of roughly $4 trillion, the biggest of three options he laid on the table. It would require sizeable tax revenues, which many Republicans oppose, and spending reductions for entitlement programs, opposed by many Democrats. But the idea of a potentially historic deal was well received by the meeting participants, officials said later, even though the details remained in dispute.

After Thursday's 90-minute session, Obama said Democrats and Republicans should be prepared to show their bottom-line demands when they return to the bargaining table Sunday.

The negotiating stakes are high. Without a deal on deficit reduction, Republican leaders say they don't have enough GOP votes to increase the nation's borrowing authority, raising the danger of the first ever U.S. default on its debts when the current $14.3 trillion debt ceiling is tapped out.

"Everybody acknowledged that we have to get this done before the hard deadline of Aug. 2 to make sure that America does not default for the first time on its obligations," Obama said. "And everybody acknowledged that there's going to be pain involved politically on all sides."

That leaves little time to agree on 10-year deficit reductions of $2 trillion to $4 trillion.

The major clash centers on how to reduce spending on major entitlement programs such as Medicare, Medicaid and Social Security, all prized by Democrats, and on tax changes that would close loopholes and end certain corporate breaks. Republicans insist that any tax changes be used to lower rates on corporations and individuals; Obama wants them also to generate more tax revenue.

Increasing the debt ceiling through the end of 2012 — a date favored by the White House — would require authorizing about $2.4 trillion in additional borrowing. House Speaker John Boehner has insisted on a 10-year deficit reduction figure that, at a minimum, matches the amount of additional borrowing. One aide to a lawmaker in Thursday's meeting said Obama made it clear he wouldn't sign a budget and debt agreement that didn't extend the debt ceiling until after the November 2012 presidential election.

In the meeting, Obama told the leaders that they faced three options — a small deficit reduction plan, a medium plan that would reduce deficits by $2 trillion over 10 years or a big agreement that would shoot for up to $4 trillion in deficit reductions over the next decade. Obama indicated he preferred the largest number.

In the meeting, Boehner and Senate Minority Leader Mitch McConnell of Kentucky backed Obama's bigger, more ambitious goal, said Democratic officials familiar with the talks. Their lieutenants, Senate GOP Whip Jon Kyl of Arizona and House Majority Leader Eric Cantor of Virginia, indicated they believed the medium-size option was more realistic. Both Cantor and Kyl had participated in talks led by Vice President Joe Biden that had already identified about $2 trillion in deficit reduction.

The negotiations are politically difficult for both parties.

Raising the debt ceiling is unpopular with voters, especially those who vote Republican, increasing concern among GOP lawmakers that they could be challenged by fellow Republicans in primaries across the country.

The big entitlement programs such as Social Security, Medicare and Medicaid have long been protected by Democrats in Congress.

Underscoring the political stakes, the Pew Research Center reported Thursday that in a recent poll it found that six of 10 of those surveyed believe it is more important to maintain Social Security and Medicare benefits than to reduce the budget deficit.

Police said the suspect possessed a handgun that was reported stolen in Georgia two years ago

Republican file photo

SPRINGFIELD – Police arrested a 47-year-old man in the Old Hill neighborhood early Friday after he allegedly pointed a gun at a woman’s head during a domestic altercation and demanded sex.

Capt. Cheryl C. Clapprood said the incident was reported about 1 a.m. at Eastern Avenue and Wilbraham Road. The suspect, John W. Ruffin, of 32 Burr St., attempted to walk away when police arrived, she said.

Ruffin, who had a loaded 9 mm handgun tucked into his waistband, was arrested after a struggle, Clapprood said.

The handgun was one of three reported stolen two years ago during a house party in Athens, Ga., Clapprood said. The owner of the guns told police that a small safe that held the guns had been carted away during the party.

Ruffin was charged with assault and battery with a dangerous weapon, assault with intent to rape with a firearm, possession of a large capacity firearm without a license to carry, possession of a high capacity feeding device, possession of ammunition without an FID card, resisting arrest, possession of a stolen gun.

The suspect is slated to be arraigned today in District Court.

Springfield police continue to probe the shooting.

View full sizeRepublican staff photo by Patrick JohnsonA Springfield police office walks back to his cruiser on Washington Street. Behind him is the scene where a 16-year-old shooting victim had been found in the road.

SPRINGFIELD – A 16-year-old boy, who was shot three times at a Forest Park neighborhood intersection Thursday afternoon and fell out of a moving car, was in critical but stable condition Friday morning at Baystate Medical Center, police said.

Capt. Cheryl C. Clapprood said police continue to probe the shooting which left the boy lying in the middle of the intersection of Washington and Meredith streets just before 4:15 p.m.

The boy’s name has not been released.

Investigators believe the victim was shot while in the car and then either fell out or jumped. Blood was found on the driver’s seat, he said. The car is believed to have coasted up the road and came to rest when it hit a parked car.

The city tallied its 9th homicide four days earlier when 38-year-old Raul E. Vera was found shot to death on Lincoln Street.

People who wish to make anonymous tips to police can use their cell phones to text information to Springfield police via Text-A-Tip by addressing a text to “CRIMES,” or 274637, and then beginning the body of the message with the world “SOLVE.” People can also contact the Springfield Detective Bureau by calling (413) 787-6355.

The economy generated only 18,000 net jobs in June, the Labor Department said Friday.

Associated PressA Mississippi Department of Employment Security representative suggests ways to improve a job application letter at a state employment center in Jackson, Miss., Thursday, July 7, 2011. Unemployment rises to 9.2 pct. in June, as employers add only 18,000 jobs.

WASHINGTON — Hiring slowed to a near-standstill last month. Employers added the fewest jobs in nine months and the unemployment rate rose to 9.2 percent.

The economy generated only 18,000 net jobs in June, the Labor Department said Friday. And the number of jobs added in May was revised down to 25,000.

The latest report offered stark evidence that the recovery will be painfully slow. Businesses added the fewest jobs in more than a year. Governments cut 39,000 jobs. Over the past eight months, federal, state and local governments have cut a combined 238,000 positions.

Two years after the recession officially ended, companies are adding fewer workers despite record cash stockpiles and healthy profit margins.

Hiring has slowed sharply in the past two months, after the economy added an average of 215,000 jobs per month in the previous three months.

The economy typically needs to add 125,000 jobs per month just to keep up with population growth. And at least twice that many jobs are needed to bring down the unemployment rate.

Economists have said that temporary factors have, in part, forced some employers to pull back. High gas prices have cut into consumer spending. And supply-chain disruptions stemming from the Japan crisis slowed U.S. manufacturing production.

In June, hiring was weak in most sectors: Manufacturers added only 6,000 jobs; Education and health care, which added jobs through the recession, was flat; and professional and business services, which include accounting, legal and engineering jobs, grew by only 12,000.

Construction and financial services cut jobs.

The weak economy and slow hiring is causing more people to simply give up looking for work. More than a quarter-million people stopped their job searches in June. That kept the unemployment rate from rising even further. When laid-off workers stop looking for work, they are no longer counted as unemployed.

Including discouraged workers and those working part time, but who would prefer full-time work, the "under-employment" rate jumped from 15.8 percent to 16.2 percent.

Unemployment has topped 8 percent for 29 months, the longest streak since the 1930s. It has never been so high so long after a recession ended. At the same point after the previous three recessions, unemployment averaged just 6.8 percent.

And those who do have jobs are earning less. Average hourly wages declined last month. After-tax incomes, adjusted for inflation, have been flat this year.

The average work week declined to 34.3 hours, from 34.4, which means employers demanded less work from their existing staffs. Usually companies demand more hours from their existing staffs when they are preparing to hire more workers.

Temporary employment fell 12,000. Businesses generally hire more temporary workers before taking on permanent ones.

The number of unemployed workers rose almost 175,000 to 14.1 million, pushing up the unemployment rate.

There are signs that economy could improve in the second half of the year. Gas prices have come down since peaking in early May at a national average of nearly $4 per gallon. Prices averaged $3.59 a gallon nationwide on Friday, according to AAA.

And manufacturing activity expanded in June at a faster pace than the previous month, according to the Institute for Supply Management. That suggests the parts shortage caused by the March 11 earthquake in Japan is beginning to abate.

The government said last month that the economy grew only 1.9 percent in the January-March quarter. Analysts are expecting similarly weak growth in April-June quarter.

The economy will grow at a 3.2 percent pace in final six months of the year, according to an Associated Press survey of 38 economists.

Still, growth must be stronger to significantly lower the unemployment rate. The economy would need to grow 5 percent for a whole year to significantly bring down the unemployment rate. Economic growth of just 3 percent a year would hold the unemployment steady and keep up with population growth.