Beat first 3 ingredients at medium speed with an electric mixer until creamy. Add eggs, milk, and vanilla, beating until smooth.
Combine flour and next 3 ingredients; add to cream cheese mixture, beating at low speed until well blended. Spread batter into a greased and floured 13- x 9-inch pan. Dollop with preserves, and swirl with a knife.
Bake at 350° for 30 minutes or until cake begins to leave sides of pan. Cool slightly, and sprinkle with powdered sugar. Cut into squares.