NEW YORK (

TheStreet

) -- Amid hopes for jobs creation, one group's assessment showed private sector employers shed more positions in March, setting the stage for Friday's highly anticipated labor market report from the government.

Private firms lost a seasonally adjusted 23,000 jobs this month, according to

Automatic Data Processing

(ADP) - Get Report

. The loss came despite consensus estimates, provided by Briefing.com, forecasting employment rose by 40,000.

ADP also revised February's losses to reflect a slightly steeper fall, to a decline of 24,000 from the 20,000 originally reported.

"American businesses are on the cusp of recovery yet this report shows that they remain hesitant to increase their payrolls," Gary Butler, CEO of ADP, said in a statement. He also said a $17.5 billion federal jobs package, signed into law two weeks ago, should provide "immediate incentives" for employers to increase hiring.

Still, the unexpectedly weaker report had some bright spots. ADP said the March drop remains the lightest since February 2008. Service-sector payrolls increased by 28,000 this month after adding 24,000 in February. Employment in the construction ranks, which fell by 43,000 this month, still reflected the smallest drop since July 2008.

But the ADP report also revealed continuing fissures in the labor market. Employment in the goods-producing segment dipped by 51,000, led by a fall of 27,000 jobs in the small business ranks. The manufacturing industry also lost an additional 9,000 jobs.

ADP said the continuing losses mirrored initial jobless claims data, which edged just higher after the new year but have since declined again of late.

The private sector reading serves as a prelude to the Bureau of Labor Statistic's monthly snapshot, which many economists hope will show jobs growth. The current consensus is anticipating nonfarm payrolls added 190,000 jobs in March, while the nation's unemployment rate held steady at 9.7%. Though the report is scheduled for release Friday morning, the stock market will be closed for Good Friday.

ADP said its own figures excluded weather-related effects caused by wintry conditions and census hiring, both of which may give a boost to the BLS tallies.

"For both these reasons, it is reasonable to expect that Friday's employment figure from the BLS will be stronger than today's estimate in the ADP National Employment Report," Joel Prakken, chairman of Macroeconomic Advisers, said in the ADP release.

Stocks opened lower after the release. The

Dow Jones Industrial Average

was slipping 24 points, or 0.2%, at 10,883, while the

S&P 500

was trading 3 points lower, or 0.3%, at 1,170.

--Written by Sung Moss in New York