Planned job cuts in the U.S. rose in December, making it the second worst month for layoffs last year, according to a report released Wednesday.

Employment consulting firm Challenger, Gray & Christmas Inc. (search) said employers announced 109,045 layoffs in December, up from 104,530 in November.

Still, for the year as whole job cuts decreased compared with 2003, and Challenger said there was reason to be optimistic in 2005.

"Job cuts are likely to continue their decline in 2005 with the economy showing signs of improvement. Jobs are finally being created at a steady rate and many of those jobs are in higher-paying occupations," John A. Challenger (search), chief executive officer of Challenger, Gray & Christmas said.

The government will report on the U.S. employment situation in December on Friday. Economists polled by Reuters forecast an increase of 175,000 jobs in non-farm payrolls for the month.