Private-sector job growth biggest in 3 years

NEW YORK (CNNMoney.com) -- Private-sector employment posted its biggest improvement in three years last month, according to a report issued Wednesday, while separate data showed the biggest increase in job cuts in eight months.

Payrolls among private employers rose by 93,000 in November, the 10th consecutive month of increases, payroll processor ADP said in its report.

The jump was bigger than economists had expected. The ADP employment report was expected to show a gain of 58,000 jobs in November, according to the Briefing.com consensus of economist forecasts. In addition, the October gain was revised by nearly double to 82,000 from the originally reported 43,000.

Employment in service jobs surged, adding 79,000 jobs. The goods producing sector added 14,000 jobs, the first monthly increase since March 2007.

"There is just a feeling that we have turned a corner, " said Joel Prakken, Chairman of Macroeconomic Advisers on a conference call with reporters. "It seems to me that we have left behind the recessionary declines of employment. We have passed through a phase where employment was flat."

The nation's smallest businesses showed the most growth: Large businesses, defined as those with 500 or more workers, increased by 2,000. Medium-size businesses, defined as those with between 50 and 499 workers, increased by 37,000. And employment among small-size businesses, defined as those with fewer than 50 workers, increased by 54,000.

Even while the report was an encouraging sign for the job market, Prakken said that it would take heftier monthly employment gains to get the unemployment rate to budge. "We are a long way from exuberant: 5% unemployment would be exuberant," he said.

Job cuts on the horizon: Employers announced plans to reduce payrolls by 48,711 jobs last month, according to Challenger, Gray & Christmas, a Chicago-based outplacement firm (see correction below). The figure was up 28% from October, but down 3.3% compared with November 2009.

The November tally was the highest since March, when employers announced 67,611 job cuts. But the spike was "not indicative of a broader trend," according to John Challenger, the firm's chief executive.

"Historically, job cuts tend to increase in the final months of the year," Challenger said in a statement. "This is the period when many companies make budget and payroll decisions for the coming year."

Planned job cuts were highest in the public sector and among non-profit companies, which announced a combined 10,761 layoffs during November. Challenger said the outlook for government workers next year is grim as Congress looks for ways to cut spending and reduce the deficit. President Obama on Monday called for a two-year freeze in the wages of federal employees.

The reports are seen as a barometer for the government's closely-watched monthly jobs report, which comes out Friday. Economists expect that employers added a total of 130,000 jobs in November, after a gain of 151,000 in October. The unemployment rate is forecast to remain unchanged at 9.6%.

An earlier version of this story gave the wrong number of announced job cuts in November.