U.S. government data released on Friday showed employment conditions varied widely from state to state in July, indicating that the economic recovery may not be consistent across the country.

The jobless rate fell in 18 states and the District of Columbia in July from June, while it rose in 14 states and was unchanged in 18 states, the Labor Department said.

Compared to a year earlier, the jobless rate fell in 27 states and rose in 20.

North Dakota, buoyed by a strong natural resources sector, again had the lowest rate in the country, at 3.6 percent. Nevada remained the state with the highest unemployment rate, at a record 14.3 percent.

Michigan followed with 13.1 percent, but the state also had the largest increase in employment from June, adding 27,800 jobs.

For many months Michigan, home to major U.S. automakers, suffered the highest jobless rate in the country, but since the start of the year the rate has slowly dropped.

Most of the jobs gains in July were in manufacturing. But the state labor department said that even without new factory jobs the July payrolls number was the highest of the year.

Michigan's manufacturing job market has stabilized thus far in 2010, said Rick Waclawek, director of the state's labor bureau. Automakers and suppliers minimized July retooling layoffs reflecting streamlined production schedules, strong vehicle sales, and lean inventories.

Altogether, the number of jobs increased in 37 states and in Washington, DC.

North Carolina lost the most jobs in July, at 29,800, followed by New Jersey.

Over the year, payrolls grew in 30 states and Washington, DC, and dropped in 19 states.

In Georgia, the unemployment rate declined to 9.9 percent. But it was still the 34th straight month in which the state's jobless rate exceeded the national one, currently 9.5 percent.

Georgia's job market continued to deteriorate, said State Labor Commissioner Michael Thurmond in a statement.

Although the unemployment rate remained virtually unchanged, a growing number of discouraged workers dropped out of the workforce, he said.

Nationally, the employment picture remains a confusing jumble. On Thursday, the U.S. Labor Department reported new jobless claims hit a nine-month high last week.

Also on Thursday the head of the U.S. Congressional Budget Office, Douglas Elmendorf, said the U.S. jobless rate will not drop below 5 percent until 2014. The rate has been gradually declining after hitting 10.1 percent in October, a high not seen since 1983.

Florida highlighted the uneven labor market. In July the state, which was hurt especially hard by the housing market downturn, saw its unemployment rate rise to 11.5 percent while the number of jobs increased by 5,700.

Pennsylvania added 3,400 jobs in July, bringing the number of private positions created in the state since the beginning of the year to 52,400. But the state's unemployment rate also rose to 9.3 percent.

More than 8,400 Pennsylvanians were working on nearly 200 highway and bridge repair projects funded by the federal economic stimulus plan in July, Governor Ed Rendell said.

Hiring is occurring, but we need to accelerate the pace and do more to put Pennsylvanians back to work by making targeted investments in our transportation infrastructure that will create tens of thousands of jobs, he said.

(Reporting by Lisa Lambert; Additional reporting by Joan Gralla in New York and Michael Connor in Miami; Editing by James Dalgleish)

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