Google Closure Compiler is jQuery or any other library agnostic. It has two types of optimizations -
I tried applying advanced optimizations, but it severely broke my application. If it does the same, you could either try to fix your application, or use simple optimization. There was a 32% drop in size with simple optimizations, and around 68% with advanced optimizations, but that didn't work out anyways.
Moving the JS concatenation in an automated fashion to your build process is definitely the way to go. See JavaScript dependency management.
jQuery is already heavily optimized for byte-size, so I doubt you will be able to squeeze enough juice by using Google Closure Compiler, but it's worth a try when combined with your project.
I see Google Closure Library in a favorable light, but haven't gotten to using it, as I'm heavily invested in MooTools at this point. Looking at it's API, it seems it has a rather broad coverage on what it has to offer besides just DOM manipulations, AJAX handling, event handling etc.
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