WASHINGTON -- Spending is declining in the consumer and capital sectors, as demand for expensive goods took its biggest spill in two years in October and consumption dropped at the sharpest rate in seven years. Meanwhile, jobless claims fell slightly but remain at elevated levels.

Orders for durable goods decreased by 6.2% last month to a seasonally adjusted $193.02 billion, the third tumble in a row, the Commerce Department said Wednesday.

Durables,...