Plus: Factory Orders Rise, Consumer Confidence Dips and North American Robotics Industry Has a Record-Breaking Year.

Factory Orders Climb in December

New orders for U.S. manufactured goods increased 1.1 percent in December, following an upwardly revised 2.2 percent gain in November, according to the U.S. Department of Commerce last week. The total value of new orders climbed by $5.3 billion to a total of $466.2 billion for the month, boosted by strong business investment in capital goods.

New orders for manufactured durable goods, up five of the last six months, rose 3 percent to $214.3 billion in December, following a 4.2 percent increase in November. Machinery orders had the largest gain, rising 6.7 percent to $34.2 billion, while primary metals increased 6.2 percent to $29.6 billion and transportation equipment rose 5.4 percent to $58.3 billion. Excluding the often-volatile transportation category, new orders increased 0.6 percent in December.

Orders for non-defense capital goods (excluding aircraft), which serve as a key gauge of future business investment plans, increased 3.1 percent to $68.9 billion, an all-time high.

“While some of that surge likely reflected a rush to make orders before investment tax breaks expired at the end of last year, many economists believe the boom in spending on new equipment will continue even with the tax breaks gone because there is a large amount of pent-up demand on the part of businesses to modernize their operations,” the Associated Press explains. “Manufacturing has been a bright spot in the recovery, although there was a slowdown in the middle of last year as factories dealt with supply shortages caused by the Japanese natural disasters that occurred in March.”

Meanwhile, shipments of factory goods, up two of the last three months, rose 2.2 percent to $207.5 billion in December, following a 0.2 percent November decrease. Primary metals shipments had the largest gain, increasing 8.7 percent to $29.2 billion. Unfilled orders for manufactured durable goods increased 1.4 percent to $911.5 billion, and inventories rose 0.3 percent to $370 billion.

“Factories boosted payrolls in January by the most in a year and the number of hours worked per week climbed to the highest in 14 years…showing how the need to rebuild inventories and replace outdated equipment will keep American industry humming,” Bloomberg News reports. “Nonetheless, a slowdown in Europe may limit gains in exports, representing a risk to American manufacturers.”

Consumer Confidence Dips in January

After two consecutive months of gains that had stirred hopes for a broader economic turnaround, the Conference Board’s Consumer Confidence Index dipped from 64.8 in December to 61.1 in January, as views on current business conditions and employment declined.

Economists polled by Reuters and MarketWatch had expected a reading of 68. A reading of 90 generally indicates a healthy economy, a level it hasn’t approached since the recession began in 2007. The December reading was upwardly revised from an original estimate of 64.5.

“Consumer confidence retreated in January, after large back-to-back gains in the final two months of 2011,” Lynn Franco, director of the Conference Board’s consumer research center, said in a statement. “Consumers’ assessment of current business and labor market conditions turned more downbeat and is back to November 2011 levels.”

The Present Situation Index, which measures how consumers currently feel about the economy, declined from 46.5 in December to 38.4 last month. The Expectations Index, which measures consumers’ outlook over the next six months, edged down from 77 to 76.2.

“Regarding the short-term outlook, consumers are more upbeat about employment, but less optimistic about business conditions and their income prospects,” according to Franco. “Recent increases in gasoline prices may have consumers feeling a little less confident this month.”

Agence France-Presse notes that renewed consumer confidence is key to “jump-starting the spending that drives the bulk of the world’s biggest economy.” Consumer spending accounts for about 70 percent of U.S. economic activity.

U.S. Unemployment Rate Drops to Three-Year Low

The U.S. labor market added 243,000 non-farm jobs in January, pushing the national unemployment rate down to 8.3 percent, its lowest level since February 2009, the U.S. Department of Labor reported Friday. The unemployment rate has now declined for five consecutive months.

“The report revealed job gains not just for the last month but for previous months,” the New York Times explains. “December job growth was revised to 203,000, from the original 200,000. The job gains for November, originally 100,000 jobs, were revised upward to 157,000, creating a picture of a job market that has been gathering steam.”

The largest gains last month were in the professional and business services industry, which added more than 70,000 jobs, while manufacturing gained 50,000 jobs and the leisure and hospitality industry added 33,000. Employment in construction rose by 31,000 jobs and mining added 10,000 jobs.

Employers have added an average of 201,000 new jobs per month in the past three months, and economists estimate that the economy has to have gains exceeding 200,000 over a sustained period to drive down the unemployment rate a full percentage point this year.

“Some economists warn against reading too much into the January jobs report because of the benchmark changes, which revise population levels, the size of the labor force and other key data. The revisions go back five years in some cases,” MarketWatch notes. “They also point out that unseasonably warm weather may have boosted employment last month beyond the usual levels in industries such as construction. Construction firms added a combined 52,000 jobs in January and December.”

Meanwhile, weekly initial jobless claims totaled 367,000 for the week ending January 28, down 12,000 from the previous week’s total, according to a separate report from the Labor Department. The four-week moving average — which smooths out week-to-week volatility — was 375,750, a decrease of 2,000 from the previous week.

North American Robotics Industry Breaks Record in 2011

North American robotics companies sold more robots in 2011 than ever before, according to new data from the Robotic Industries Association (RIA). Valued at $1.17 billion, the 19,337 robots sold to companies in North America topped the previous record of 18,228 robots sold in 2005.

Compared with 2010, orders for robots in North America jumped 47 percent in units and 38 percent in dollar value, the industry trade group reports. When sales by North American robot suppliers to companies outside North America are included, there were 22,126 robots sold last year, valued at $1.35 billion.

The automotive industry helped drive the uptick in demand for industrial robots: “Robots sold to automotive component suppliers in North America jumped 77 percent over 2010, while robots sold to automotive OEMs increased 59 percent,” Paul Kellett, director of market analysis for the RIA, said in a statement.

“The growing interest in automation combined with the strengthening of North American manufacturing industries, particularly automotive, contributed to a great year for the robotics industry,” according to RIA President Jeff Burnstein.

Sales to non-automotive customers rose 27 percent, led by metalworking industries (up 56 percent) and semiconductor/electronics/photonics (up 24 percent). In terms of applications, significant increases were seen in spot welding (up 78 percent), arc welding (up 66 percent), assembly (up 63 percent), coating and dispensing (up 42 percent) and material handling (up 30 percent).

The fourth quarter of 2011 was the strongest quarter ever since the RIA began reporting data in 1984. Units ordered totaled 5,721 robots, with a total value of $317.5 million, in Q4.