Private-sector jobs up 260,000 in Nov.

Companies created the most jobs in nearly a year in November, adding to cautious optimism that the country's battered labor market is working its way toward healing.

Better-than-expected housing and regional factory data released Wednesday reinforced the view that the economy should avoid recession, though growth is unlikely to be brisk.

"All of this confirms the economy, after slowing in the late spring and early summer, is back firmly at its 2- to 2.5-percent growth rate," said Steve Blitz, senior economist at ITG Investment Research in New York.

Even so, Blitz added, "Firstly, I need to temper the enthusiasm that these numbers indicate that economic growth is accelerating, and secondly, it's still a very dangerous world out there."

The ADP National Employment Report Wednesday showed private employers added 206,000 jobs this month, surpassing economists' expectations for a gain of 130,000 jobs. It was the biggest gain since December 2010.

The data set an optimistic tone ahead of Friday's government report on the labor market, and some economists raised their forecasts.

"So far in the current U.S. economic expansion, the only period of relatively healthy job creation lasted for a few months from late last year to this spring," said Ryan Wang, U.S. economist at HSBC Securities USA.

"Today's job gain of 206,000 in November raises the possibility that we may be on the cusp of a similar period of job creation."

The weak labor market remains one of the biggest hurdles for the economic recovery.