U.S. private employers cut 473,000 jobs in June, more than expected but down from the 485,000 jobs lost in May, a report by a private employment service said on Wednesday.

The median of forecasts from 25 economists surveyed by Reuters for the ADP Employer Services report, jointly developed with Macroeconomic Advisers LLC, was for 393,000 private-sector jobs lost in June.

Though June's job loss was the smallest since October 2008, the surprisingly large number of cuts deals a setback to those expecting the U.S. economy to recover soon.

The data surprises me a little bit in that the consensus out there seems to be that business is improving and that the economy has hit bottom, said Mark Bonhard, investment advisor at Dawson Wealth Management in Cleveland, Ohio.

This definitely is not good news.

After the report, U.S. stock index futures pared their gains. U.S. Treasury debt prices initially recovered some ground but were then hit by renewed selling. The U.S. dollar pared its losses versus the euro.

The May figure was revised from an originally reported loss of 532,000 jobs.

The ADP data comes ahead of Thursday's monthly nonfarm payrolls report from the government, which is much more comprehensive and includes both the public and private sectors.

Economists expect the payrolls report, which will be issued a day early due to the Independence Day holiday on Friday, to show a loss of 363,000 jobs in June and a rise in the unemployment rate to 9.6 percent from May's 9.4 percent.

ADP follows another privately released report showing planned layoffs at U.S. firms fell for a fifth consecutive month in June, hitting the lowest since March 2008 and providing a hopeful sign as the U.S. economy struggles to end its worst recession in decades.