WASHINGTON (AP) -- Orders to U.S. factories advanced strongly in March for a second month while demand in a key category that signals business investment plans increased by the largest amount in more than a year. The strength was further evidence that the economy was rebounding after a harsh winter.
Orders increased 1.1 percent in March after increasing 1.5 percent in February, the Commerce Department reported Friday. Those gains followed two months of declines in December and January.
Orders for core capital goods, considered a good proxy for business investment, jumped 3.5 percent in March, rebounding from a 0.9 percent drop in February. It was the biggest increase since January 2013.
Economists say rising demand will boost factory production in coming months, helping the overall economy emerge from a winter slowdown.
In other upbeat news, the Labor Department said Friday that the economy added 288,000 jobs in April, the biggest monthly gain in more than two years, with the unemployment rate falling to 6.3 percent, its lowest level since September 2008.
Orders for durable goods, items expected to last at least three years, rose 2.9 percent in March, an improvement from an initial estimate of a 2.6 percent in the advance report released last week. There were widespread gains in a number of areas with increases in demand for machinery, computers and primary metals such as steel.
Orders for non-durable goods such as chemicals, paper and food, fell 0.6 percent in March.
Severe weather depressed activity during the winter and analysts had expected a rebound in orders and production as the weather improves.
A closely watched gauge of manufacturing activity showed improvement in April. The Institute for Supply Management reported Thursday that its manufacturing index rose to 54.9 in April, up from 53.7 in March. Any reading above 50 indicates expansion in manufacturing.
The ISM index showed a pickup in exports in April. Manufacturers are also being helped by increased domestic demand. A separate report Thursday said that consumer spending rose by 0.9 percent in March, the fastest pace in 4 1/2 years, as consumers spent more on manufactured goods.
Economists are hoping that momentum shown at the end of the January-March quarter will translate in to stronger economic growth in the April-June quarter.
The gross domestic product, the broadest measure of the economy's health, slowed to a barely discernible growth rate of 0.1 percent in the January-March quarter, reflecting in part the disruptive effects of the harsh winter. But analysts expect growth could rebound in the current quarter to a rate around 3 percent.
They also project that that pace of activity will hold up for the rest of the year, as the economy benefits from stronger job growth which will help support gains in consumer spending.