Here's something no one wants to hear: The orders for durable goods in March experienced the biggest drop in three years, which halts the momentum in the manufacturing sector--a leading source of jobs since the recession ended.
"Bookings for goods meant to last at least three years dropped 4.2 percent, the biggest decrease since January 2009, after a revised 1.9 percent gain the prior month," reports Bloomberg's Timothy Homan on data that the Commerce Department revealed today. In non-economic wonk terms, durable goods "meant to last three years" can range from small appliances to computers, to purchases like cars and planes. Homan and the Associated Press have the specific numbers break down on the goods and results from the major industries, which range from big drops in transportation equipment (12.5 percent) and commercial aircraft orders (50 percent) to meager gains in autos and auto parts (.1 percent gain down from a 2 percent rise in February). "Excluding transportation equipment, orders declined 1.1 percent. That's the second drop in that category in three months," reports the AP.
Homan points out that economic slow downs in Europe and China are leading to the lack of exports. And it's a fact that Americans are still spending confidently--retails sales rose in March, and the AP mentions that consumers are spending more leading to the economy "expanding at 3 percent annual pace in the final three months of last year." But the reason this drop is a bit disconcerting is that it's a sign of stalling in manufacturing which, the AP reports, "has been a leading source of growth and jobs since the recession ended." (In March, Obama was touting the addition of 429,000 manufacturing jobs in the past two years.)
"This was a weak report," economist Ellen Zentner told the AP. It "certainly points to slowing business investment as we enter the second quarter."