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Orders received by U.S. factories rose an unexpectedly strong 2.8 percent in October, the Commerce Department said today, due mainly to a surge in orders for long-lasting durables such as commercial aircraft and automobiles.

In another economic report today, labor productivity, a key measure of economic vitality, was revised sharply downward for the third quarter.

The factory order figure was the strongest monthly orders rise since March, when they rose 4.0 percent, department officials said.

The rise in October orders, to a seasonally adjusted annual rate of $250.7 billion, followed a revised 0.2 percent fall in orders during September.

But excluding transportation, orders for October were up a more modest 0.9 percent following a 0.8 percent rise in September. Other surveys like those done by the nation's purchasing managers say orders have been weakening recently.

The overall 2.8 percent gain in October orders was well above economists' expectations for a 1.6 percent increase.

The department said October factory orders were buoyed partly by higher oil prices since the Aug. 2 invasion of Kuwait by Iraq.

In addition, a key component of factory orders, durable goods, rose 3.9 percent in October after declining 1.6 percent in September. Durables are items like refrigerators and automobiles designed to last at least three years.

In the other report, the Labor Department said that non-farm productivity rose only 0.2 percent in the quarter instead of its previously reported 1.6 percent increase. Productivity rose 0.3 percent in the second quarter.

The department said the downward revision reflected the fact that output was unchanged but hours of workers fell 0.2 percent -- the first drop in this category since 1986.

The figures were released against a backdrop of a slowdown in the economy that many economists believe is now in recession.

The oil-fired price pressures of the Gulf crisis also are weighing heavily on the economy and are thought by some to have already pushed it over the edge.

The implicit price deflator for non-farm business, a measure of inflation, rose 3.7 percent in the third quarter, compared with a 4.8 percent jump in the prior three months.

The department said that manufacturing productivity rose 5.1 percent led by an increase of 7.4 percent in the so-called durable goods sector.

Non-durable goods productivity was up 1.6 percent and the overall productivity including farming rose 0.4 percent.

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