The Commerce Department said Thursday that total durable goods orders fell 13.2 per cent in August, the biggest drop since January 2009 when the country was in recession. Aircraft orders fell by 101 per cent.
Business orders for machinery, electronics and other equipment, which are a good indication of their investment plans, rose 1.1 per cent. That's the first increase since May.
Durable goods are items that are expected to last for at least three years. Orders tend to fluctuate from month to month.
Overall, total orders fell to $198.5 billion in August. That's still 33.5 per cent above the recession low hit in April 2009.
U.S. manufacturing, which had helped pulled the economy out of the Great Recession three years ago, has weakened since the spring. Factories have been hurt by a decline in consumer spending and slower global growth that has cut demand for U.S. exports.
Less factory production has sapped a critical source of growth and jobs in the United States. The trend is expected to keep growth and hiring tepid through the November elections.
The economy grew at an annual rate of just 1.3 per cent in the April-June quarter, the Commerce Department said Thursday in a separate report. That's much lower than its previous estimate of 1.7 per cent and too weak to lower the unemployment rate.
Many economists below growth won't exceed 2 per cent for the rest of the year.
High unemployment and sluggish growth prompted the Federal Reserve last week to announce several major steps to boost the economy. Chairman Ben Bernanke said the Fed will buy $40 billion of mortgage-backed securities a month until there is "substantial" improvement in the job market.