The government Wednesday said new orders for durable factory goods rose in April for a fourth straight month, but most of the gain was attributable to military orders, prompting some economists to say the report was evidence of a faltering economy.
Lawrence Hunter, chief economist of the U.S. Chamber of Commerce, called the 1.4% gain "yet another sign of a weak recovery."
In a separate report, the National Assn. of Business Economists said Wednesday that consumer and business demand for durable goods such as autos would support economic growth of 2% this year.
That represented a half-point upward revision from their forecast of three months ago. Their projection for 1993 remained at 3% growth.
Even more significantly, the survey of 44 professional forecasters rated the chances that the recovery could falter, as a similar rebound did last year, at only one in five.
Still, the NABE forecast served to underscore the general view that this recovery will be one of the weakest on record. In the two years after the 1981-82 recession, the economy as measured by the gross domestic product grew at rates of 3.9% and 6.2%.
The April advance in durable goods, items expected to last three or more years, followed gains of 2.3% in March, 0.2% in February and 2.3% in January.
Durable goods, products ranging from autos to battleships, had not posted so many successive gains since rising for six months from February through July, 1987.
But most of April's strength came from a huge 21.6% surge in demand for military hardware. Demand for civilian goods edged up 0.2%.
Hunter said that in a normal recovery, orders for manufactured goods post monthly increases topping 3%. He said he was also concerned that the backlog of unfilled orders dropped for an eighth consecutive month, edging down 0.2% in April.
David Wyss, an economist at DRI-McGraw Hill, said that while the overall number was significantly higher than economists had been expecting, the figure was heavily skewered by defense, a sector that is extremely volatile from month to month depending on when government contracts are signed.
"This is a decent number but not a great number," Wyss said.
He said the government was likely to revise upward its estimate of first-quarter GDP growth to 2.5% when the figure is released on Friday. He also forecast GDP growth improving to a 3.5% rate in the second half of this year.
That might not be enough growth to keep the unemployment rate, now 7.2%, from rising this summer as a sluggish economy fails to produce enough jobs for graduates entering the labor market.
Durable Goods New orders in billions of dollars, seasonally adjusted April,'92: 125.4 March, '92: 123.6 April, '91: 124.5