U.S. consumer confidence (search) rose to a three-year high in June, buoyed by a more optimistic view of the labor market, The Conference Board said in a report Tuesday.

The Conference Board (search) said its gauge of sentiment rose nearly three points to 105.8 from a revised 103.1 in May. Analysts on average had expected a rise to 104.0 in June.

The improved confidence index came as consumers felt more optimistic about the U.S. labor market. The proportion of consumers saying jobs were "hard to get" in The Conference Board survey declined to 22.6 percent from 24.1 percent.

"This improvement in consumers' mood suggests that business activity and labor market activity will continue to pick up over the next several months," said Lynn Franco, director of The Conference Board's Consumer Research Center.

"And with consumers in better spirits, and job concerns remaining relatively steady, there is little reason to expect a dramatic shift in consumers' spending," Franco added.

Consumer spending (search) is the backbone of the U.S. economy, accounting for two-thirds of overall activity, and changes in confidence are seen as a possible precursor to softer or stronger growth.

The Conference Board's confidence index present situation reading rose to 120.7 from 117.8 while its expectations index measure rose to 95.8 from 93.4.

"The numbers are encouraging and suggest that there's still life in the American consumer," said Rick Egelton, senior vice president and chief economist at BMO Financial in Toronto.

"Both the present situation and expectations components were up more than the market had anticipated. The important 'jobs hard-to-get' measure also fell in the month so it was a broad-based improvement on consumer confidence," he said.