Factory Orders Decline 2.3% In September; 2 Million Jobs Lost In 2 Years!

Yahoo News ^ | November 4, 2002 | Jinneane Aversa

[Red Jones]

Factory Orders Continue to Decline

By JEANNINE AVERSA, Associated Press Writer

WASHINGTON (AP) - Orders to U.S. factories fell for a second straight month in September. It was another setback for manufacturing, which has seen almost 2 million jobs evaporate over the last two years and is struggling not to sink even deeper into the quicksand of economic uncertainties.

The Commerce Department (news - web sites) reported Monday that factory orders declined by 2.3 percent in September, after a 0.4 percent drop in August. September's decline marked the third decrease in the past four months.

"With consumer demand softening of late, businesses remain very cautious about levels of new orders and production," said Susan Polatz, economist with Banc of America Securities.

While September's performance was better than the 3 percent decline analysts had predicted, more forward-looking data suggest a somber outlook for manufacturing.

The Institute for Supply Management reported Friday that manufacturing activity shrank in October, the second monthly drop in a row.

On the same day, the government reported that 49,000 factory jobs were lost in October, marking the 27th straight month in which manufacturing jobs were eliminated. Job losses during that period came to nearly 2 million.

"Clearly, manufacturing is suffering," said economist Clifford Waldman of Waldman Associates. "Manufacturing has lapsed from a moderate growth path into a modest recession."

Hardest hit by last year's recession, manufacturing has been the weakest link for the sputtering national economic recovery, which many analysts say is losing momentum in the current October-December quarter.

The economy, powered by consumer spending, especially on cars and other big-ticket goods, rebounded in the summer, growing at a rate of 3.1 percent. But many analysts worry that the summer boom foreshadowed a winter lull.

Pessimistic economists believe the economy will grow at around a 1 percent pace in the October-December quarter as consumers tighten their belts, worried about the economy's direction and a possible war with Iraq. The wobbly economy will be weighing on voters' minds when they vote in midterm elections Tuesday.

Growing numbers of economists believe the Federal Reserve (news - web sites) may cut short-term interest rates for the first time this year at its next meeting Wednesday. If not, analysts say a rate cut would be likely in December.

Wall Street has rallied in recent days on rising hopes of a rate cut. The Dow Jones industrial average rose another 53.96 points on Monday to close at 8,571.60.

Rates have been at four-decade lows all year long. By keeping rates low or possibly nudging them down, Fed policy-makers hope to motivate consumers and businesses to spend and invest more, helping to boost economic growth.

Consumers, whose spending accounts for two-thirds of all economic activity in the United States, have been the main force keeping the economy going this year. Some analysts worry that they might be getting tired.

Low interest rates and extra cash from a boom in mortgage refinancing have helped support consumer spending this year. On the other hand, negative factors, including the stagnant job market, eroding consumer confidence and the turbulent stock market, seem to be making consumers more cautious, analysts say.

Businesses, meanwhile, have yet to see their profits fully recover from last year's recession. Because of that, they have been reluctant to make big commitments to hiring and investment, factors restraining the recovery.

Virtually all the weakness in September's factory orders reflected slackened demand for durable goods, big-ticket items expected to last at least three years. Those orders fell by 4.9 percent, after a 1.1 percent drop in August.

Primary metals, machinery, commercial airplanes and parts were among areas posting losses in September. Those losses swamped gains elsewhere, including orders for cars, computers and household appliances.

For nondurable goods, such as food and clothes, orders to factories rose by 0.9 percent in September, down from a 0.5 percent increase in August.

[Red Jones]

ALL your Republican buddies in DC keep saying the economy is good...

except for 1 thing, they're not my buddies ... ... don't pin that on me!!! I'm with you, I'm tired of both parties. I was 110% behind Reagan, I used to vote straight Republican and I also used to regularly convince others to vote Republican. NOT ANY MORE!!!

I was in Hayworth's (R) district and I so much was looking forward to voting for democrat challenger because Hayworth supports h1b, supports big spending republican style and is a globalist Republican. But they switched me to Flake (R). Flake is a new congressman, only been in 2 years. He didn't have a chance to vote on a big H1b bill, so I'll vote for him. But I sent him an email. I let him know, he votes for H1b and I permanently vote for his opponent after that.

I used to be a loyal republican. NO MORE!! George Bush says I'm a racist because I oppose h1b. Yeah, I oppose h1b all right and next time George's name is on the ballot when I vote, I'll oppose George Bush too!

Someday resources will be gathered around me and we will engage in communications efforts for real with the american population. The republican party is in my sights.

[txrangerette]

"The President...says the economy is
doing great".

No, he did NOT.

Every day he has said exactly the
truth. It is "just kind of bumping
along"..."not good enough".

"Not as strong as it could be" & "!
am not satisfied if anyone who wants
to work can't find work".

He HAS said he's optimistic about the
future. And that underlying factors
are strong(they are)..interest rates,
inflation, productivity etc..

On what we need to do, he says: make
tax cuts permanent, pass terrorism
insurance, control fed. spending, get
an energy bill, etc.etc. Also looking
anew at tax policy for growth ideas.

The Senate is Daschle's Dems' arena
for hurting the economy & blaming W.

Also, the entire slide began while
WJC was prez.

W has told it true from the get go.

[lizma]

Or maybe you are part of the problem.

Praising the guy who works about 2 1/2 hrs of day when he is expected to do 7!!! What is to good about this? They screwed themselves over even before NAFTA.

The unions have abused their power. There is nothing stupid in observing a fact.

Yeah, I went to college. My farmer and factory working family valued education but I never, NEVER, once not value their contributions to the building on America.

This proletarian vs. bourgeoisie arguement would probably serve you better on the DU website, where where class envy is in vogue.

I think Buchanan has good points on this issue, but my point is the unions have set themselves up for this hit. The unions, necessary at the start, have become too powerful, and many of their workers, users and abusers of this protected system.

[Temple Owl]

Notice how AP pushed this story out on election eve. Check tomorrow's dailies, they'll be leading with this garbage.

[VOA]

Factory Orders Decline 2.3% In September; 2 Million Jobs Lost In 2 Years!

Funny, I missed the headlines about how millions of jobs were temporarily created
based on funding that poured into an insane dotcom speculation fraud.

Oh, that's right, it's news embargo when it comes to the Clinton Decade of Greed.

[RLK]

Rates have been at four-decade lows all year long.

------------------------------

When an additional 2,000,000 people are unemployed, lowering interest rates won't help them or anybody else.

[RLK]

But..But...But...This can't be possible. I have been seen, with my own eyes, the President of the United States say the economy is doing great!

---------------------------

Bush wanders around with a half-grin tatooed on his face alternating between a daze and confusion. Unless he can keep up a war to have people cling to him, say hello to president Hillary.

[RLK]

I'll take innovation over (labor) organization and gladly leave the former economies to machines and the Chinese.

----------------------

Please provide us with a list of what you have innovated this year.

[Karsus]

"There may be some tough times here in America, but this country's gone through tough times before, and we're going to do it again," Bush said at the end of the President's Economic Forum in Waco, Texas. "The foundations of the American economy are strong."

Other than the tech sector, telcom sector, manufacturing sector, corp debt, consumer dept, corp spending, consumer spending, H1B visa issue, and the layoffs the economy is strong!

The President is not doing what he can to control gov spending nor is he doing everything he can to fight terror/protect us. After all the INS is still around and our borders are still not protected.

[Justa]

A list of my innovations this past year? Whoa, that'd be a long one -seriously.

I'm sensing you haven't taken control of your power curve yet. You're in the driver's seat. Make those turns before life makes them for you. Innovation -it's the American Way. A positive attitude bordering on "stupid person" is a must.

Of course otoh you could just get lucky....

Network, always network. I'm currently developing my skill set for a job in the Middle East which will provide a 3-fold increase in salary. Finding better ways to do my current work while developing skills for a new job = innovation. And nobody innovates like Americans (except for maybe the Russians and Isralis).

[RLK]

Other than the tech sector, telcom sector, manufacturing sector, corp debt, consumer dept, corp spending, consumer spending, H1B visa issue, and the layoffs the economy is strong!

-------------------------

Har!

[taxed2death]

I'll bet you've never set foot on a new modern hi-tech machine shop. The technology would blow you away. Not everyone out there can afford an ivy league degree. Not everyone out there has the desire to work in a cubicle and make a tall stack of paper shorter at the end of the day.

What about the tens of thousands of kids who graduate from H.S. each year and maybe are not that skilled to get a "hi-tech" job or a job in telecommunications.

I know of several young guys that prefer "working with their hands" and like to see something in the physical realm for their 8 hours work at the end of the day. Since 9 out of 10 mom and pop machine shops and tool making shops have been put out of business in the NE in the last 15 years, these kids have no secure jobs to step into. The few tool making jobs that are around pay VERY good, good enough for mommy to stay home with the kids if she so chooses.

Yea "we're not a manufacturing based economy any more"
No sh!t....thanks to ""free trade".

Free trade hs a very high price.

My friends in the few remaining tool shops are pulling down 70,000 or more a year.....not bad for working in a quiet, well lit, air conditioned shopas well as not having a degree.

One problem with your statement is this: What exactly have we transitioned to? Ask the .commers how secure their jobs are. They're all working three Mcjobs now to survive. It really sucks NOT having a manufacturing base to fall back on.

Don't take this personally, but you're statements are not based on reality.

[taxed2death]

I agree with you 100% with the exception of your last sentence. It should read "Our nation IS paying a terrible price".

[Non-Sequitur]

So how much longer can the Fed keep cutting interest rates in the face of mounting budget deficits? Once the rates start going up again what will that do to the recovery?

[taxed2death]

Would you rather these hi paid auto workers make the minimum wage working at the DB Mart. How would this help our economy? These people spend their money here on these shores. These highly paid workers also pay much more in taxes than someone with three Mcjobs. There are other things to consider.. If your new 27,000.00 dollar car costs 500 dollars more because we pay hi wages to these workers, the benefits of actually paying 500 more far outweigh the actual cost. See my point? :)

[taxed2death]

MAN!!!!!! You NAILED IT! 100% correct. Thanks, I couldn't have said it better.

[FreedomPoster]

The original method seen for funding the FedGov was through trade tariffs (i.e. no income tax). A small tariff to encourage domestic manufacturing and hiring, but not reward gross inefficiency, is not a bad idea. No more than, say, 10%. And get rid of income tax. ;-)

[taxed2death]

Sorry about my miss-spells today, I suffered a horrendous accident here in my own sweatshop. (NOT!) I cut two fingers yesterday and have them bandaged, makes for some funky typing :) :)

[LS]

I don't think you are. My wife was thrilled with the new system (and she hates to fly) and found it much more comforting. Now, you (not you personally, but people) can whine all they want about searches, etc., but there are MANY people out there like my wife who see what was once a shipshod bag check at least now APPEAR orderly, and at least the PERCEIVED attention to security. Believe it or not, that means a lot to a lot of people.

I have flown four times since 9/11, and they were all the easiest, most efficient, and best flights I ever took.

[txrangerette]

Your quote proves my point. He most
certainly has not gone around saying
"the economy is just great". That is
what a poster claimed Bush has been
doing. My post refuted him. And so
does the quote you gave.

When W says strong "fundamentals",
he repeatedly lists what those are.
My post listed examples. Higher
productivity, low interest %s, low
inflation, etc. Those are what he
calls foundations for a growing &
stable economy. They are here now!
Then he always says, "we need to
build on them".

Again, Daschle's Senate, make the
tax cuts permanent, pass an energy
bill including ANWR in AK, pass a
terrorism insurance bill to get our
hardhats working again(construction)
& give me homeland security power to
change, reorganize & manage these
100 agencies.

And yes, I want good tax & regulatory
reform ideas to spur growth, beyond
our actions so far. GIVE ME A SENATE
I CAN WORK WITH!

He has told the truth about the state
of the economy since day one. Those
recent stats showing various areas of
current weakness, he has admitted the
softness & troubling areas over and
over. He also states any positives, &
he should because there are some.

The poster I was refuting said flat-
out untruths about the President. I
called him on it.