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Job seekers line up at a community employment center in California last year. One of the more discouraging aspects of the U..S recovery is that the fall in employment was not halted by increased hiring, but by a fall in quit rates.ROBYN BECK

U.S. private employers shed 23,000 jobs in March, missing expectations for an increase although fewer than the adjusted 24,000 jobs lost in February, a report by a private employment service said Wednesday.

The February fall was originally reported at 20,000.

The median of estimates from 35 economists surveyed by Reuters for the ADP Employer Services report, jointly developed with Macroeconomic Advisers LLC, was for a rise of 40,000 private-sector jobs this month.

However, Friday's U.S. payrolls report by the government's Bureau of Labor Statistics may still result in a gain despite disappointment over private sector job losses, Macroeconomic Advisers LLC chairman Joel Prakken said after the ADP report.

"Even though today's number might be a little disappointing when you allow for special factors the BLS number on Friday could easily be a strong positive number," Mr. Prakken told a teleconference of journalists.

Improvements in monthly employment should gather pace later this year, he said.

"Later this year I do expect to see these monthly changes in employment move up first into the 100,000 to 200,000 range and then eventually even over 200,000 or 250,000 by the end of the year because we've got a lot of people to put back to work as the economy recovers," Mr. Prakken said.