Washington, D.C., March 26--Orders to U.S. factories for big-ticket goods fell by 1.2 percent in February, the biggest decline in three months, a fresh sign of the struggles facing the nation's battered manufacturing sector.
The decline erased part of the 1.9 percent gain in orders for costly manufactured products registered in January, the Commerce Department reported Wednesday.
Private economists predicted orders for durable goods - products expected to last at least three years - would fall in February as companies put off buying new equipment as the war with Iraq became imminent.
The drop in February's orders, however, wasn't as big as the 1.5 percent decline economists were forecasting.
The manufacturing sector, hardest hit by the 2001 recession, has been the biggest drag on the economy's ability to get back to full throttle.
In February, the weakness in orders to factories was broadbased, with losses reported for computers, cars and metals.
Tuesday's report is consistent with other recent data which showed that manufacturing activity was lackluster in February. Orders for automobiles fell 1.5 percent in February, down from a 9.9 percent advance in January. Excluding orders for transportation equipment, durable-goods orders declined 2.1 percent in February, the largest decline in eight months.
Shipments, a good barometer of current demand, decreased by 1.6 percent in February, compared with a 2.7 percent gain in January.
The biggest factor holding back the economy's recovery is the reluctance of business to make big commitments in hiring and in capital spending, due in part to uneasiness about war and generally to an uncertain business environment. Against that backdrop, the nation's unemployment rate rose to 5.8 percent in February as the economy lost a whopping 308,000 jobs.
