Economic conditions deteriorated in July, corporate purchasing agents reported yesterday in their monthly survey of business conditions.

Production rates, incoming orders and employment all dropped sharply, said the National Association for Purchasing Management.

The industry group said deliveries from suppliers came in faster than during the month before, an indication that suppliers have a smaller backlog of business.

The membership survey found the number of companies reporting lower production and fewer new orders was about the same as when the country was coming out of last year's recession.

The slump was more than just seasonal, the association added. Employment usually goes up in July because of summer hiring, but this year it was down. The number of companies reporting increased employment fell from 16 percent in June to 12 percent, while the number listing fewer people on the payroll increased from 15 percent to 19 percent.

Among the companies surveyed, 29 percent said their production was down in July, compared with only 13 percent reporting a drop in June. The number of firms reporting increasing output has slipped steadily for three months, from 31 percent in May, to 20 percent in June and to 18 percent last month.

The purchasing agents reported prices of copper, silver and petroleum products declined.