Manufacturers, already hit by mounting job losses, saw business plummet to the lowest level in 26 years in October. Sharply lower auto sales and shrinking construction spending, meanwhile, provided more evidence the U.S. has entered a recession that may be deep and prolonged.

The Institute for Supply Management said Monday its manufacturing index fell to 38.9, the lowest reading since September 1982, when the country was near the end of a 16-month recession. Any reading below 50 signals contraction.

Automakers said Monday their sales fell in October in what may be the worst drop in 25 years as low consumer confidence and tight credit combined to scare customers away from showrooms.

Sales sank 45 percent at GM, 30 percent at Ford, 25 percent at Honda and 23 percent at Toyota.

''Everything we can tell about the economy just got weaker,'' said Stuart G. Hoffman, senior vice president and economist for the PNC Financial Services Group. The manufacturing report confirmed the economy is falling deeper into recession, he said.

The manufacturing index had been hovering near what economists call ''the boom-bust'' line for most of the year. October's reading of 38.9 was sharply below the September figure of 43.5 and lower than economists' expectations of 41.5, according to the consensus estimate of Wall Street economists. AP