Factory Orders Plunge Record 5.9% : Economy: The Commerce Department blames the November drop on less demand for long-lasting items.

Orders to U.S. factories for manufactured goods fell 5.9% in November, the largest one-month plunge on record, the government said today.

The Commerce Department attributed the drop to sharply lower demand for long-lasting durable items such as cars and airplanes.

The drop in November orders, to a seasonally adjusted annual rate of $235.4 billion, followed a revised 2.5% increase in orders in October and was more severe than economists’ expectations of a 4.6% decline.

Excluding transportation goods, orders were down 2% after a 0.7% rise in October. Other surveys, including one released earlier this week by the nation’s purchasing managers, say orders continued their fall in December.

The last comparable drop in total factory orders was a year ago, in January, 1990, when they fell 5.5%, the department said.

It was the second report today showing growing weakness in the industrial sector. The Labor Department reported that factory payrolls fell by 33,000 in December after a 200,000 decline in November. That meant that nearly 600,000 manufacturing jobs have been lost since December, 1989.

A key component of factory orders, durable goods, fell a record 10.7% in November after rising 3.6% in October. Durables are items such as refrigerators and automobiles, designed to last at least three years.

Major car makers slashed production rates by about 16% for the final quarter of 1990 and now have further cut back scheduled production for the first three months of 1991 by about 14%.

Sales of new U.S.-made cars and trucks plunged in mid-December by 19% as demand for new vehicles dropped to 1982 recession-era levels.

A week ago, in a separate report on durable goods alone, the Commerce Department said orders had dropped 10.5% in November, largely because of less demand for new passenger aircraft and for cars.

Durable goods account for about half of the factory orders index, so any change in volume strongly affects the monthly figures.