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SOUTHEASTERN N.C. ECONOMY GROWS; U.S. ECONOMIC GROWTH WILL BE SLOW REGARDLESS OF ELECTION OUTCOME

 SOUTHEASTERN N.C. ECONOMY GROWS; U.S. ECONOMIC
 GROWTH WILL BE SLOW REGARDLESS OF ELECTION OUTCOME
 FAYETTEVILLE, N.C., Oct. 19 /PRNewswsire/ -- Home-building in the Fayetteville and Wilmington areas has set a record this year, while retail sales and airport boardings are up as well. More people are working in the Fayetteville MSA than last year, while job growth in Wilmington is flat. Unemployment in both markets is higher than a year ago but is trending down from peaks earlier this year.
 These were among the highlights of the First Union Perspectives Economic report given here today by J. Ronald Hankins, First Union's Southeastern area executive. Hankins reported those results at the annual economic luncheon sponsored by First Union's Fayetteville office for more than 200 business and community leaders. The keynote speaker was David Orr, First Union's chief economist, who analyzed the state and national economies in this election year.
 "In every election year since 1948, when President Truman was elected, the incumbent party has won when real disposable personal income was 3.5 percent or greater," Orr said. "When this measure -- which is after-tax personal income adjusted for inflation -- is less than 3.5 percent, the incumbent party historically has lost. Looking at our real disposable personal income of 1.3 percent in August, you can draw your own conclusions."
 Orr predicted that the Gross Domestic Product would temporarily improve in the second half of 1993 to 3-4 percent, rather than the 2 percent range the country has been experiencing. Regardless of the election outcome, economic recovery will continue to be slow, he said.
 "The economy is gradually working its way through the necessary structural changes caused by the debt overload, the S&L debacle, problem loans at banks, defense cutbacks, demographic shifts, lower inflation, the health care crisis, etc. 1993 will be better than 1992, which was better than 1991. A return to 'normal' is not in the cards, however, whether it's Bush or Clinton in the White House."
 Orr predicted that short-term rates, including CDs, would remain in the 3 percent range until at least mid-1993 and then move up perhaps 1 percentage point by yearend. Mortgages, which are tied to long-term rates, are rising because of the expected Clinton victory and the turmoil in the currency markets. Long-term rates may rise another one-fourth to one-half point by late winter and then move down again as inflation remains low, Orr said. He expects the Consumer Price Index to move closer to 2 percent from the current 3 percent level.
 In Southeastern N.C., the economy is stronger than the nation in several aspects. Single-family home building in Cumberland County set a record this year with 1,351 permits through July -- a 66.2 percent increase over last year. New Hanover County also set a record with 800 permits, up 14.1 percent over last year. Permits in Moore County totaled 306, up 19.5 percent over the first seven months of 1991. Multifamily construction is also strong, with Cumberland permitting 281 units -- the most since 1986 -- and New Hanover reporting 138 units, up 86.5 percent.
 Retail sales in Cumberland County totaled $1.0 billion through June (the latest available from the state), a 12.1 percent increase over the same period last year. Retail sales in New Hanover are up 4.4 percent to $833 million, while sales in Moore County rose 6.6 percent to $257 million. New-car and truck sales in Cumberland through September are essentially flat, with 9,794 vehicles registered. New Hanover reported a gain of 5.2 percent, with 4,851 vehicles, while Moore County registered 2, 068 vehicles, a 2.3 percent gain.
 The employment picture here is mixed. Total employment is higher as of August in the Fayetteville MSA, with an estimated 97,040 people working, a 2.2 percent increase over last year; Fayetteville unemployment in August was 6.4 percent, up from last year but down from a peak of 7.1 percent in June. In the Wilmington MSA, 65,670 people were employed in August, down slightly from 65,740 last year. August unemployment was 6.7 percent, higher than last year but down from the 7.7 percent peak in June. The commercial construction market, which often swings widely from month to month, is mixed as well.
 Nonresidential permits in Cumberland County through July totaled $17.1 million -- up 152 percent over a weak 1991 and almost back to the 1990 level. Permits in the new Hanover County totaled $10.7 million in the first seven months, which is down 41.8 percent from last year and is half of the 1990 level. Moore County permits totaled $7.6 million, down 16.9 percent from the last year.
 Airport travel in both markets, however, is growing. Boardings in Fayetteville through September are up 3.6 percent to 156,050, while boardings in Wilmington totaled 164,339, a 14.9 percent increase.
 In addition to Southeastern N.C., the First Union Perspectives program tracks the economy on an ongoing basis in Charlotte, Western N.C., the Triangle and the Triad. First Union National Bank of North Carolina is a principal subsidiary of Charlotte-based First Union Corporation (NYSE: FTU FTUpr) and operates 270 offices throughout the state.
 -0- 10/19/92
 /CONTACT: Sandy Deem, First Union Corporation, 704-374-2710/
 (FTU) CO: First Union Corporation ST: North Carolina IN: FIN SU: ECO


CM -- CH004 -- 1619 10/19/92 13:05 EDT
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