Orders For Durable Goods Dip 1 Percent In November

December 24, 2008 11:22 a.m. EST

New York, NY (AHN) - The Commerce Department said Wednesday that orders for durable goods fell 1 percent in November, marking the fourth straight month of decline as demand for manufactured goods continues to slump.

Total new orders for manufactured goods fell to $1.8 billion in November. The decline was much smaller than the 3 percent drop economists had predicted after seeing orders plummet 8.4 percent in October.

The majority of weakness came from a 37.7 percent decline in orders for commercial aircrafts and parts. Demand for auto parts and vehicles stabilized a bit, falling just 0.2 percent after several months of decline.

Excluding transportation related goods, orders rose 1.2 percent in November; the strongest result since this past June.

The majority of strength came from orders for computers and electronic products, up 5.9 percent for the month. Demand for new machinery was also strong as orders rose 4.1 percent.

Still pressuring demand for new goods is rising inventory levels, up sixteen of the past seventeen months. Inventories rose 0.5 percent in November to $342.9 billion, marking the highest level since the department began tracking data in 1992.

Rising inventory levels, a slumping housing market and soft automobile demand have pressured manufacturing activity most of the year leading to many layoffs in the industry.

Large manufacturers ranging from General Motors to Textron have announced plant closings and job reductions over the past several months.