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GAINS IN CONSTRUCTION, EMPLOYMENT, RETAIL SALES BOOST TRIAD ECONOMY

 GAINS IN CONSTRUCTION, EMPLOYMENT, RETAIL SALES BOOST TRIAD ECONOMY
 WINSTON-SALEM, N.C., May 13 /PRNewswire/ -- Increases in home- building, commercial construction, employment growth and retail sales -- including car sales -- have created one of the most positive economic outlooks the Triad has seen in months.
 "The balance of the Triad economy definitely has tipped toward the positive side," said Mike Crocker, Winston-Salem area executive for First Union National Bank of North Carolina, who presented the bank's Triad Perspectives economic briefing here today.
 Employment in the Triad has been growing since September. March total employment was estimated at 491,800, up nearly 6,000 jobs from March 1991. "Manufacturing employment is almost holding its own now," Crocker said. "The decline in manufacturing jobs from March 1991 to March of this year was only 200 jobs. And there actually were increases in household fixture employment and in textile and apparel employment."
 Nationally, those three industries were up sharply in production in March: textile production was up 8.2 percent; apparel, 5 percent; and furniture 4.9 percent.
 Unemployment in the Triad was 5.5 percent in March, up from 5.0 percent in March 1991, but still lower than the state rate of 6.5 percent and the U.S. rate of 7.7 percent. Part of the growth in unemployment may be attributed to a growth in the labor force rather than to job losses, Crocker said.
 "Our unemployment rate has been increasing, but the rate of increase has averaged only about 10 percent for the past seven months," Crocker said. "That's the lowest growth of the unemployment rate of any major N.C. metropolitan area."
 As employment has stabilized, home-building activity has strengthened as well. Through February, Guilford and Forsyth counties issued 571 single-family home permits, a 51 percent increase over 1991 and more than 10 percent higher than 1990. Guilford permitted 343 homes, the best January and February since 1988, while Forsyth permitted 228 homes, the most since 1987. The market is dominated by the entry- level market of homes in the $70,000 to $100,000 range, Crocker noted, and most homes are pre-sold before built.
 Multifamily permitting is up sharply in Guilford County, with 185 permits through February, the most in six years. That number was dominated by permits for the Well Spring retirement community in Greensboro, however, and represents only a fraction of the permitting in 1986. In Forsyth, multifamily activity continues to be low, with only two units permitted.
 Apartment construction will continue to be erratic, Crocker said, with tax changes having taken away some incentives for development and demographic changes reducing apartment demand. "But apartment occupancy rates have apparently risen fairly sharply here this year already," Crocker said. "And we understand that investors are eager to find existing apartment complexes here to buy."
 Commercial construction in the Triad was up 42.3 percent through February, with most of the increase coming in Guilford County.
 Guilford's total of $36.4 million was boosted by the $21.1 million- plus permit for the new Friends Home West continuing care retirement complex. Forsyth permitted $5.0 million, including $3.7 million for the Lowrance Middle School and a healthy sampling of medical projects. That number is down 47.7 percent from the first two months of 1991.
 "The commercial portion of the construction economy swings a good bit, just as multifamily does, depending on when sizable projects are permitted," Crocker said. "So you couldn't extrapolate a year's forecast from the first two months of the year."
 Economic development activity throughout the Triad has been strong. "Here in Winston-Salem, corporate recruiting business is running 20 percent ahead of last year," Crocker said. "New and expanded business here by 170 firms last year should result in some 1,365 new jobs over the next year or so. Already, in first quarter, we have 41 new and expanding firms, meaning some 680 new jobs, compared with 312 jobs in the first quarter of last year."
 In High Point, economic development activity so far this year is matching the strong years of 1989 and 1990. In Greensboro, economic development activity by year-end is expected to exceed last year, when investments totaled $131 million.
 On the consumer front, retail sales have been surprisingly strong. January sales, the most recent available, were up 5.5 percent in Guilford County and 12.5 percent in Forsyth. Fourth quarter sales were up 7.5 percent over the previous year in Guilford County and up 3 percent in Forsyth. For the first time in two years, those are valid comparisons, as reported by the state. Anecdotal results from many retailers through April showed 20-30 percent gains over last year.
 "With continued sales growth through the spring, all the retail contacts we talked with expect this rebound of retail to hold through the year," Crocker said. "They are optimistic enough to do some significant hiring ... At the same time consumers are back in the stores, they also are paying off their debt, not increasing it again. When you consider that normally, in a bad recession, both credit application and debt collections go down, the rise here of both is significant."
 Car sales in the Triad also were up 20.2 percent in the first quarter, representing an $18 million gain over first quarter 1991. Crocker also noted a shortage in available used cars, which is keeping those prices relatively high.
 First union's forecast also calls for:
 -- Perhaps one or two moderate-size apartment projects;
 -- Commercial construction values along the scale of 1991's numbers;
 -- Increasing employment growth, probably reaching a record high in
 employment mid-year, with unemployment starting to decline by
 third quarter;
 -- New-car sales that, at worst, level out, but more likely rise to
 just under 1990 figures (a 10-12 percent increase over 1991);
 -- Retail gains that are strongest in the first three quarters; with
 fourth-quarter sales up about 6-7 percent. Overall for 1992,
 retail sales should be up about 7-10 percent.
 The First Union Perspectives program also tracks the economy on an ongoing basis in Charlotte, Western North Carolina, Southeastern North Carolina and the Triangle. Results are reported for each area three times per year.
 First Union National Bank of North Carolina is a principal subsidiary of Charlotte-based First Union Corporation (NYSE: FTU FTUpr) and operates 270 offices in more than 200 North Carolina communities.
 -0- 5/13/92
 /CONTACT: Sandy Deem, First Union Corporation, 704-374-2710/
 (FTU) CO: First Union National Bank of North Carolina; First Union
 Corporation ST: North Carolina IN: FIN SU: ECO


CM -- CH004 -- 9717 05/13/92 13:02 EDT
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Date:May 13, 1992
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