Twenty-two of 78 economists including those at Deutsche Bank AG, Morgan Stanley and UBS AG increased projections for tomorrow’s payrolls figures from the Labor Department. The median forecast in the Bloomberg News survey calls for a 150,000 gain, up from 135,000 before yesterday’s data from ADP Employer Services. Goldman Sachs Group Inc. and JPMorgan Chase & Co. maintained their December payrolls estimates

“The consensus has been too cautious in its assessment for this year” on economic growth, Paul Donovan, deputy head of global economics at UBS, said in a telephone interview. “If you have a job, you are going to be more confident about maintaining your job and for an economist, that’s the most important thing — how people in work feel about job security.”

ADP said that companies increased employment by 297,000 last month, triple the median forecast and exceeding the highest projection in a Bloomberg survey. That added to evidence of a broadening recovery as the Institute of Supply Management’s non-factory index showed service industries expanded in December at the fastest pace since 2006.

Economists at Goldman Sachs and JPMorgan elected not to alter their December payrolls estimates, while noting the ADP figures suggested a risk the Labor Department’s numbers will be higher than forecast.

Barclays View

New York-based Barclays Capital economist Theresa Chen said in a note to clients today that the ADP number was “clearly a strong report and suggests some upside risk” to her forecast of a 150,000 gain. “However, the ADP data often do not predict well the changes in nonfarm payrolls within the same period, so we are not revising our payroll forecast in response to this report,” she said.

Goldman Sachs and JPMorgan economists wrote in e-mails to clients that ADP data may have been distorted by a seasonal factor associated with year-end employment. Workers, regardless of when they are dismissed or quit, sometimes remain on company records until December, when businesses update their figures with ADP.

ADP estimates this so-called purge effect in adjusting their data for seasonal changes and the company’s projection this year may have been too large because there were fewer firings this year than in the previous two, economists said.

Bank of America, Citigroup

Donovan of UBS now predicts an increase of 160,000 for December payrolls, set for release tomorrow at 8:30 a.m. from the Labor Department in Washington. He previously forecast a gain of 120,000. Other firms that revised up their estimate include Bank of America Merrill Lynch Global Research, Citigroup Inc., HSBC Holdings Plc and Jefferies & Co.

The median adjustment of the 22 revised forecasts received by Bloomberg was up by 50,000.

“Many including ourselves will now scramble to revise higher estimates for non-farm payrolls,” Mitul Kotecha, head of global foreign exchange strategy at Credit Agricole CIB in Hong Kong wrote in a note to clients today. “We now look for a 240k increase.”

That’s the highest forecast in the current Bloomberg survey for tomorrow’s number. The lowest prediction at present is 98,000 by Peter Morici at the University of Maryland.

Companies are gaining confidence. Miami-based Carnival Corp., the world’s biggest cruise-line operator, forecast fiscal 2011 earnings will increase as ticket prices and demand strengthen. Memphis, Tennessee-based FedEx Corp. last month raised its profit forecast for fiscal 2011.

Federal Reserve

Federal Reserve policy makers last month reiterated that progress toward cutting unemployment and preventing inflation from slowing too much remained “disappointingly slow,” according to minutes of their Dec. 14 meeting. The officials affirmed their plan to buy $600 billion in Treasury securities through June, aimed at bolstering the economy and reducing joblessness.

UBS’s Donovan said that there is still spare capacity in the economy. The jobless rate was 9.8 percent in November, close to a 26-year high of 10.1 percent reached in October 2009.

“As we go through 2011, there’s going to be a definite need for the Federal Reserve to provide accommodation,” Donovan said. “There’s no question of running a restrictive monetary policy when you’ve got this degree of spare capacity and the growth evidence we have at the moment is not going to change that balance.”