The number of planned layoffs at U.S. firms fell in March to the lowest level in 10 months as the government sector cut fewer jobs, while call center employees were let go by companies looking to reduce costs, a report on Thursday showed.

Employers announced 37,880 job cuts last month, down 26.8 percent from 51,728 in February, according to the report from consultants Challenger, Gray & Christmas. It was the lowest level since May 2011.

March's job cuts were also down 8.8 percent from the same time a year ago when 41,528 layoffs were announced. Since the start of 2012, employers have announced 143,094 cuts, up 9.4 percent from the first three months of 2011.

For the year so far, the government sector has seen 5,750 cuts, far below the 41,929 in the first quarter of last year.

"This may simply be the eye of the storm for government workers — lull in activity in an election year and a time when many state budgets are still being negotiated," John Challenger, chief executive officer of Challenger, Gray & Christmas, said in a statement. "The potential for a surge in government cuts is significant."

Telecommunications firms faced the highest number of layoffs last month with 4,089 job cuts. Almost half of that came from T-Mobile USA, which said it is cutting 1,900 jobs as it closes seven call centers.

Verizon Wireless, Wells Fargo and television retailer QVC also said they were reducing call center jobs.

Meanwhile, hiring plans rose 15.6 percent to 12,390 from 10,720 in February and were up 14 percent from 10,869 a year ago.

The report comes a day ahead of Friday's key U.S. jobs report, which is expected to show the economy added 203,000 jobs last month.