Today’s durable goods orders release from the U.S. Census Bureau shows 0.8 percent decline in September. (All percentages are in annual terms.) This number only tells part of the story, though, as much of the decline was due to volatility in the transportation sector. Excluding transportation, new orders for manufactured durable goods would have increased by 1.7 percent. Much of the decline was in the aerospace sector (both for defense and nondefense), which fell significantly after a large rise in August. New orders for motor vehicles also fell by 2.7 percent.
Yet, outside of transportation, the new orders figures reflected some strength. Here are the monthly growth rates for new orders from the major sectors:
- Capital Goods, excluding Aircraft, up 2.4 percent;
- Computers and Electronic Products, up 1.0 percent;
- Defense Capital Goods, up 8.6 percent;
- Electrical Equipment, Appliances, and Components, up 1.9 percent;
- Fabricated Metal Products, up 1.9 percent;
- Machinery, up 1.8 percent; and
- Primary Metals, up 2.6 percent.
These numbers suggest that the larger durable goods industry is showing some broader-based growth as we move into the autumn months.
Looking at other parts of this release, durable goods shipments fell 0.7 percent in September; excluding the transportation sector, shipments would have decreased 0.1 percent. Transportation shipments were down 2.7 percent. The largest increases in shipments were seen in communications equipment, computers and related products, fabricated metal products and primary metals.
Both unfilled orders and inventories continued to grow in September, by 0.8 percent and 0.1 percent, respectively.
Chad Moutray is chief economist, National Association of Manufacturers.