The number of U.S. workers continuing to receive state jobless aid jumped to record high in mid-February, data showed on Thursday, as the 14-month recession ravaged the economy and squeezed companies.

The worsening domestic and global economic slump also pushed new orders for long-lasting manufactured goods to a six-year low in January.

Companies are trying to costs amid slumping demand and tight access to credit through massive layoffs, but those actions are creating a negative feedback loop for the economy.

The government has stepped in with a $787 billion stimulus package to put a floor under the crumbling economy.

The weak reports reinforce the view that problems in the U.S. economy are more significant than what had been priced in the market, said Matthew Strauss, senior currency strategist at RBC Capital Markets, Toronto.

The number of people remaining on the benefits roll after drawing an initial week of assistance increased by 114,000 to a more-than-forecast 5.112 million in the week ended Feb 14, the most recent week for which data is available, the Labor Department said.

Initial claims for state unemployment insurance benefits increased to a seasonally adjusted 667,000 last week from 631,000 the prior week, the department said. It was the highest reading since October 1982, when claims reached 695,000.

The upward trend in unemployment claims suggests that we haven't seen the worst in the labor market situation yet, probably leading to higher unemployment rates, said Gary Thayer, senior economist at Wachovia Securities in St. Louis, Missouri.

U.S. equity index futures pared gains after the data, while U.S. Treasury debt prices trimmed losses.

A separate report from the Commerce Department showed new U.S. orders for long-lasting manufactured goods fell for a sixth consecutive month in January, as a global slump crimped exports and domestic spending faltered.

Durable goods orders dropped 5.2 percent to $163.8 billion in January, the lowest level since December 2002, from a 4.6 percent decline in November.

It certainly shows the deterioration in the economy, said John Boo, director of equity trading at Ferris, Baker Watts Inc in Baltimore.

They're going to be doing a lot less business and they're going to need fewer employees. The news confirms fears that we're not going to get any kind of immediate turnaround, at least in the manufacturing sector.

New orders excluding transportation dropped 2.5 percent in January, while motor vehicles and parts fell 6.4 percent.

Non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending, fell 5.4 percent in January. The previous month was revised to show a 5.8 percent plunge, previously reported as a 3.2 percent drop.

(Additional reporting by Alister Bull, Ellen Freilich; Editing by Neil Stempleman)

Unemployment