GNP Growth Figures Revised Downward : Transportation Sector Fuels Rise in Durable Orders

Orders to U.S. factories for “big-ticket” durable goods jumped 3.6% in October, driven by a 14.6% gain in the transportation sector, the government said today.

The Commerce Department reported that orders for durable goods--items expected to last more than three years--totaled a seasonally adjusted $129.4 billion. It was the largest advance since a 4.1% gain in May.

Excluding transportation, however, orders fell 0.4% last month.

Orders fell 1.6% in September and 0.9% in August.

“Since reaching a high in December, 1988, of $132.1 billion, orders have been unstable, fluctuating around a monthly average of $125.9 billion,” the department said. “Much of the volatility was attributable to transportation equipment.”

Durable goods orders are a key barometer of manufacturing industry plans for production. A decrease in orders could result in a slump in that sector and subsequent job layoffs.

Transportation orders totaled $37.9 billion, reflecting purchases of both aircraft and automobiles. They had fallen 6.1% in September after a 1% gain the previous month.

Orders in the key category of non-defense capital goods, often a barometer of business plans to expand and modernize, rose 8.3% to $41.4 billion after advancing 6.7% in September.

Only orders for non-electrical machinery and for defense goods posted declines. Non-electrical machinery orders were off 1.5%.