Share
July 27, 2020 11:00 AM, EDT

Orders for Big-Ticket Manufactured Goods Jump 7.3% in June

A General Motors worker validates N95 masks in Warren, Mich., on April 23.A General Motors worker validates N95 masks in Warren, Mich., on April 23. (Paul Sancya/Associated Press)

[Ensure you have all the info you need in these unprecedented times. Subscribe now.]

WASHINGTON — Orders for big-ticket manufactured goods rose a solid 7.3% in June, the second big monthly gain as manufacturing tries to climb out of a spring slump triggered by the coronavirus pandemic.

The Commerce Department said July 27 that the June gain in durable goods orders, which was better than expected, followed an even bigger 15.1% increase in May. Those two increases came after sharp declines in March and April as factories shut down.

A closely watched gauge of business investment posted a strong 3.3% increase in June after a 1.6% rise in May.

Newsmakers host Dan Ronan

Transport Topics introduces its newest digital interview series, Newsmakers, aimed at helping leaders in trucking and freight transportation navigate turbulent times. Audience members will gain access to the industry's leading expert in their particular field and the thoughtful moderation of a Transport Topics journalist. Our second episode — "The Evolution of Electric Trucks" — featuring Nikola founder and executive chairman Trevor Milton, will air live on July 28 at noon EDT. Registration is free but advance signup is required. Sign up today.

Even as factories come back to life, economists caution that manufacturing could slump again if surging cases in many parts of the country derail a broader economic rebound.

“The sugar rush from re-openings has now faded and a resurgence of domestic coronavirus cases, alongside very weak demand, supply chain disruptions ... and high levels of uncertainty will weigh heavily on business investment,” said Oren Klachkin, the lead U.S. economist at Oxford Economics.

“Risks to the recovery will remain heavily tilted to the downside so long as the health situation does not improve,” he said.

The June increase was led by a 20% gain in the transportation sector as orders for cars, trucks and parts surged 85.7%. That figure captures the resumption of production by big automakers. Vehicle sales offset a big decline in orders for commercial aircraft as major airlines, operating at vastly reduced capacity, cancel orders for new planes from Boeing in waves.

Excluding the volatile transportation sector, orders for durable goods, items expected to last at least three years, rose 3.3%, following a 3.6% gain in May.

Want more news? Listen to today's daily briefing: