WASHINGTON (MarketWatch) – Demand for U.S.-made durable goods rose a seasonally adjusted 0.5% to $178.1 billion in February, the third straight increase in a key forward-looking indicator, according to Commerce Department data released Wednesday. New orders for machinery and civilian aircraft were strong in February, while new orders for autos, defense goods and electronics declined. The 0.5% increase in durable goods orders was weaker than the 1.7% gain expected by economists surveyed by MarketWatch. However, January’s orders were revised higher, from a 2.6% gain to 3.9%. December’s orders were also revised higher.
Analysis from Dr. Mark J. Perry, Professor of Economics and Finance at University of Michigan, Flint:
MP: New orders for durable manufactured goods in February reached the highest level ($178.1 billion) since November 2008 (see top chart above). The 12-month percentage change in February of 10.9% followed an 11.9% increase in January, which was the highest annual increase in new orders for durable goods and equipment from U.S. manufacturers since September 2006, more than three years ago (see bottom chart). The last time there were two consecutive double-digit monthly increases in durable goods orders was four years ago in the spring of 2006.
Add this to the growing list of V-shaped signs of economic recovery, especially in the U.S. manufacturing sector.
Reblog from Carpe diem
Tag: Durable Goods
The Bureau of Labor Services reported the preliminary productivity changes in manufacturing for the second quarter of 2009:
5.3 percent gain in manufacturing;
3.9 percent gain in durable goods manufacturing;
2.0 percent gain in nondurable goods manufacturing.
According to the BLS, “The increases in productivity in all manufacturing sectors were the result of hours falling faster than output. Manufacturing includes about 11 percent of U.S. business-sector employment.”
Productivity is defined as output per hour worked.
The 5.3 percent gain in manufacturing productivity is reported to be the largest quarterly gain in this indicator since the first quarter of 2005, when output per hour increased at a 7.3 percent annual rate. Over the last four quarters, manufacturing productivity declined 1.3 percent, as a 15.0 percent drop in output was largely offset by a 13.9 percent decline in hours worked… For the entire 2000-2008 period manufacturing productivity increased at a 3.3 percent annual rate.
The BLS declining hours data for manufacturing is approximately double that of the precision machining industry. PMPA’s Length of First Shift declined 7.9% by the end of the second quarter compared to the BLS’s “hours worked decreased 14.4 percent ” figure for manufacturing in the second quarter.
