Jobs shed by U.S. private employers in February dropped from the prior month, while U.S. firms' planned layoffs fell to the lowest since 2006, suggesting the job market may be starting to recover.
Private employers cut 20,000 jobs in February, compared with 60,000 jobs losses in January, the report by ADP, a payroll processor, showed on Wednesday. The 20,000 jobs was in line with the median estimate.
This is a positive sign that we are turning the corner toward job growth, said David Resler, chief economist at Nomura Securities International in New York.
In the same month, the number of planned layoffs at U.S. firms fell to the lowest level since July 2006, according to a report from global outplacement consultancy Challenger, Gray & Christmas, Inc.
The report also said employers appear to have shifted away from downsizing and may be poised to start adding workers.
U.S. stocks were slightly higher after the data, while the dollar briefly gained versus the yen, and U.S. Treasuries eased.
Even though some sectors of the economy, including manufacturing, have been recovering from the worst U.S. economic downturn since the 1930s, the job market has remained weak, with unemployment near 10 percent.
On Friday, the Labor Department is scheduled to release monthly non-farm payrolls, the most closely watched measure of the country's labor market.
Joel Prakken, chairman of Macroeconomic Advisers LLC, which developed the private sector report with ADP, said on a conference call that recent severe winter storms had little impact on the private sector report but could have a sizable effect on Friday's payrolls data.
(Reporting by Caroline Valetkevitch; additional reporting by Leah Schnurr and Rodrigo Campos; editing by Jeffrey Benkoe)