U.S. April machine tool demand tumbled 8.0 percent from March as the manufacturing sector continued to struggle despite signs the economy is beginning to improve, two industry groups said in a joint report on Sunday. 

The American Machine Tool Distributors' Association (AMTDA) and the Association for Manufacturing Technology (AMT) said U.S. April machine tool demand totaled $171.36 million, down 8.0 percent from a revised $186.22 million in the prior month. March national demand was revised upward from a previously reported $182.66 million. 

Purchases of machine tools -- used to shape metal for such products as car engines, refrigerators and television sets -- has slumped 15.7 percent from the same month a year ago as a depressed economy has slowed demand for these products. 

Demand in the first four months of the year was $689.02 million, down 30.8 percent from $995.66 million in the same period in 2001. 

"Manufacturing is still dragging despite some optimistic general economic reports of a near term recovery," Ralph Nappi, president of AMTDA, said in a statement. 

Nappi said the sector shows little sign of turning around as businesses look overseas for cheaper labor and more favorable manufacturing environments, stunting investment in new equipment domestically. 

A flurry of economic data released last week showed signs the economy is emerging from a recession that began in March of 2000. 

The Labor Department said on Friday that the unemployment rate fell unexpectedly to 5.8 percent in May, bringing it off a 7-1/2 year high of 6 percent hit in April. 

Still, the data showed the economy created only an anemic 41,000 jobs last month, leaving many analysts to conclude that the Federal Reserve is unlikely to raise interest rates any time soon. 

U.S. construction spending on homes, offices, schools and the like rose 0.2 percent to an annual rate of $871.9 billion in April, the Commerce Department said on Monday. During the month the nation spent a record $425.5 billion, at an annualized pace, on places to live. 

U.S. machine tool demand in April fell 40.1 percent in the Northeast region to $19.05 million from $31.80 million in March. Demand in the South edged lower by 19.9 percent to $26.23 million from $32.75 million. Demand also fell 7.2 percent in the Midwest to $55.08 million from $59.38 million. 

The Western United States posted the largest increase in April with demand jumping 23.2 percent to $38.96 million from $31.62 million in the prior month. Businesses in the Central region pushed machine tool demand up 4.4 percent to $32.04 million from $30.68 million. 

The machine tools report is generally based on a survey of about 200 manufacturers, distributors and importers of machine tools that represent 76 percent of the machine tool market.