Kentucky's unemployment rate rose to 8.5 percent in August from 8.3 percent a month earlier, the state announced Thursday.
The rate lagged the national unemployment measure, which fell to 8.1 percent from 8.3 percent in July.
Manoj Shanker, economist with the Kentucky Office of Employment and Training, said in a statement that "some fallback was expected" given the state of the economy.
During August, seven of the state's 11 major economic sectors reported employment increases, with the state adding 2,500 non-farm jobs.
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Leading the growth was the trade, transportation and utilities sector, which added 2,100 jobs.
Shanker attributed the jump to the gain in vehicle sales.
"The demand has not only increased manufacturing employment but boosted retail and wholesale trade employment, too," he said in a statement.
The leisure and hospitality sector increased by 900 jobs, while the government sector added 800 jobs in August.
Other sectors adding employees were financial activities (200), mining and logging (200), construction (200) and information (100).
The largest job losses came in the educational and health services sector, which shed 800 jobs.
Shanker said the decline came from the sector's health care portion, which accounts for nearly 90 percent of employment in the sector.
"Health care employment is stabilizing as private insurance companies, as well as the government, are ratcheting down health care reimbursements," he said. "Providers are responding by consolidating and trimming employment."
The professional and business services sector lost 600 jobs in August, though Shanker noted that the temporary service subsector "grew a robust 12 percent."
Other sectors with declining employment were manufacturing (500) and other services (100). The latter includes religious organizations and repair shops.