Unemployment in Tennessee was unchanged last month at 8.5 percent despite a decline in the U.S. jobless rate during July.

The Tennessee Department of Labor and Workforce Development said today that employment fell by 2,500 jobs across Tennessee during July, primarily due to cuts in state government jobs. Over the past year, Tennessee's unemployment rate increased from 8.2 percent to 8.5 percent.

Tennessee's jobless rate was 1.1 percent above the national rate of 7.4 percent in July. Unemployment in the Volunteer State has remained above the U.S. average for most of the past two years.

Despite an increase in the jobless rate in the past year, non-farm employment in Tennessee last month was still up by 32,300 jobs from a year ago. The largest increases were in leisure/hospitality, professional/business services, and retail trade.