Mixed signals for the job market

The outlook for the U.S. job market remains cloudy, as private sector payrolls expanded in February at the same time that layoffs grew as well, according to two reports released Wednesday.

Private sector employers added 217,000 jobs in February, according to payroll processor ADP. That's up from an upwardly revised increase of 189,000 jobs in January.

Economists surveyed by Briefing.com had expected a gain of 165,000 jobs in the month.

But a separate report from outplacement consulting firm Challenger, Gray & Christmas said that employers announced plans to cut 50,702 jobs in February, a 32 percent increase over January. That's also 20 percent higher than the 42,090 planned layoffs announced in February 2010.

"It is too soon to say whether the increases in January and now February represent a trend," said John Challenger, CEO of Challenger, Gray & Christmas.

But there are a variety of factors that might continue the trend, with the sharp spike in oil prices among them.

"At the very least, rising energy costs could force employers to postpone hiring plans," Challenger said. "At worst, increased costs could kill the fragile recovery and spur another round of layoffs."

The surge in gas prices that followed rising oil might spillover to retail employers as well.

"If gasoline tops $4.00 per gallon in the coming weeks, consumers may be forced to make significant changes to their spending habits. At this stage of the recovery, that could be an extremely damaging setback," said Challenger.

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