Orders placed with U.S. factories fell in January for a sixth consecutive month, reflecting a pullback in business spending that will probably extend what may become the country's worst recession in seven decades. Bookings declined 1.9 percent, less than forecast, after a revised 4.9 percent drop in December, the Commerce Department said today in Washington. Excluding demand for transportation equipment such as cars and aircraft, which tends to be volatile, orders fell 0.9 percent after a 5.4 percent drop the prior month. The credit squeeze that's exacerbating the U.S. and global downturn is forcing companies to cut investment and fire workers as demand from businesses and consumers plunges. President Barack Obama last month enacted a $787 billion recovery plan and proposed a record-high budget to jolt the economy out of the slump and chart a path toward long-term, sustained growth. ``Companies saw the writing on the wall and aggressively cut back production, jobs and inventories,'' Julia Coronado, a senior economist at Barclays Capital Inc. in New York, said before the report. ``They're trying to get ahead of demand.'' Factory orders were forecast to fall 3.5 percent, after a previously reported 3.9 percent drop in the prior month, according to the median estimate of 65 economists surveyed by Bloomberg News. Estimates ranged from declines of 0.4 percent to 6 percent. In a separate report, U.S. worker productivity in the fourth quarter unexpectedly fell as the economy shrank even faster than companies cut jobs and hours. Productivity, a measure of employee output per hour, fell at a 0.4 percent annual rate, the first decrease in a year and much less than the 3.2 percent gain estimated last month, the Labor Department said today in Washington. Jobless Claims Also today, Labor said more than 600,000 Americans filed first-time claims for unemployment benefits last week for a fifth straight time as companies kept trimming costs. The economy shrank 6.2 percent in the fourth quarter on an annualized basis, the most since 1982, and spending on new equipment dropped at a 29 percent pace, the most since 1958, the Commerce Department said on Feb. 27. ``Manufacturing output fell sharply again in January, bringing the rate of capacity utilization to its lowest level in the post-World War II period,'' Federal Reserve Chairman Ben S. Bernanke said March 3 in testimony to Congress. Today's report showed orders for non-durable goods including food, petroleum and chemicals rose 0.5 percent in January. Bookings for petroleum and coal products rose 9.4 percent. Orders for durable goods, which make up just over half of total factory demand, fell 4.5 percent, after a 4.6 percent drop the previous month. Aircraft Orders Civilian aircraft orders soared 168 percent after declining 58 percent the prior month. Still, Boeing Co., the world's second-biggest commercial- airplane maker, last month said it was prepared to cut output by about 10 percent next year if more orders are deferred or cancelled because of the global recession. Boeing has seen ``a lot of activity in terms of deferrals'' this year, Scott Carson, the head of the commercial unit, said last month at a Barclays Capital conference in Miami Beach, Florida, in remarks broadcast online. The Chicago-based company reported a fourth-quarter loss and has said it plans to cut 10,000 jobs, or 6 percent of the workforce. Bookings for motor vehicles and parts decreased 6.6 percent in January. The deterioration continued into February as U.S. auto sales slid 41 percent to the lowest rate since December 1981, according to Autodata Corp., led by a 53 percent drop for General Motors Corp. Asian carmakers such as Toyota Motor Corp. and Nissan Motor Co. also reported plunging U.S. sales. Scaling Back ``Even if you can afford the loan, people are not willing to take on the risk right now because of concern about jobs,'' Al Castignetti, Nissan's vice president of U.S. sales, said in an interview this week. Orders for construction machinery rose 40 percent after a 34 percent decline the month before. Bookings for capital goods excluding aircraft and military equipment, a measure of future business investment, fell 5.7 percent after a 5.9 percent decline. Shipments of those goods, used to calculate gross domestic product, decreased 6.7 percent after rising 0.1 percent. Factory inventories fell 0.8 percent, and manufacturers had enough goods on hand to last 1.46 months at the current sales pace, up from 1.44 months. Exporters of equipment are struggling amid a slowdown in global trade. Deere & Co., the world's largest maker of farm equipment, said Feb. 18 that first-quarter profit fell 45 percent and cut its full-year earnings forecast because tight credit and a drought may continue to hurt sales in Latin America. ``Higher material costs, the deepening global recession, and volatile foreign exchange rates have put downward pressure on our financial results,'' said Chief Executive Officer Robert Lane.

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