The latest economic data from the government suggest the slump in U.S. manufacturing continues.
The Commerce Department reported Tuesday that new orders for manufactured goods in October, down three of the last four months, decreased $19.3 billion, or 4.7 percent, to $390.3 billion. That marks the largest decrease since July of 2000, and followed a 1.7 percent September increase.
New orders for manufactured durable goods in October decreased $18.8 billion, or 8.2 percent, to $210.2 billion, revised from the previously published 8.3 percent decrease, and new orders for manufactured nondurable goods decreased $0.5 billion, or 0.3 percent, to $180.2 billion.
Shipments, up two of the last three months, increased 0.1 percent following a 4.2 percent September decrease. Unfilled orders, up seventeen of the last eighteen months, increased 1.2 percent and are at the highest level since the series was first stated on a NAICS basis in 1992.
The unfilled orders-to-shipments ratio was 4.56, up from 4.46 in September. Inventories, up twelve of the last thirteen months, increased 0.4 percent and the inventories-to-shipments ratio was 1.23, unchanged from September.Meanwhile, U.S. manufacturers continued to increase their productivity in the third quarter, expanding output and decreasing the amount of hours worked.
The Labor Department said Tuesday that productivity increased 6.7 percent in manufacturing in the third quarter, the largest quarterly productivity gain since the third quarter of 2003, when manufacturing output per hour grew 8.6 percent. Manufacturing productivity growth was initially estimated at 5.9 percent in the third quarter.
In durable goods industries, productivity increased 9.0 percent in the third quarter, as an increase of 5.9 percent in output combined with a decrease of 2.9 percent in hours. Productivity grew more slowly in the nondurable goods industries, 3.1 percent, reflecting increases of 3.9 percent in output and 0.8 percent in hours, the government said.
The average hourly compensation of all manufacturing workers rose 2.4 percent in the third quarter. Hourly compensation was revised down in the second quarter, from the 4.0-percent increase reported previously to a 5.8-percent decrease. In durable goods industries, hourly compensation increased 4.1 percent in the third quarter, compared with a 0.5 percent decline in nondurable goods manufacturing.
When the increase in consumer prices is taken into account, real hourly compensation for all manufacturing workers declined 0.5 percent in the third quarter of 2006.
The Labor Department said unit labor costs in manufacturing fell 4.1 percent in the third quarter of 2006 and 8.3 percent in the previous quarter, as revised. Unit labor costs declined 4.5 percent in durable goods industries and 3.5 percent in nondurable goods manufacturing during the third quarter.
Non-farm business productivity increased 0.2 in the quarter, versus the original estimate of unchanged.