
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: WEDNESDAY, March 13, 1991                   TAG: 9103130118
SECTION: BUSINESS                    PAGE: C5   EDITION: METRO 
SOURCE: GEORGE KEGLEY BUSINESS EDITOR
DATELINE:                                 LENGTH: Medium

ROANOKE ECONOMIC INDEX DIPS

Economic indicators for Roanoke and much of Virginia "show clearly the negative impact of a national and state recession," according to a new report. But that assessment was coupled with a guarded forecast for recovery by early summer.

The Virginia Business Report, published by the Bureau of Business Research at the College of William and Mary, noted a 5.3 percent decline in January for its index for the Roanoke area.

The index, based on eight weighted indicators registered declines of 80 percent in the value of building permits, 29 percent in auto registrations, 13.5 percent in electricity consumption, and 6.4 percent in water consumption.

Increases were a 14.6 percent gain in bank checking transactions, 2.5 percent rise in newspaper advertising lineage, 2.1 percent in employment in December and a 3.2 percent rise based on a sample of retail sales. All the comparisons are to year-earlier levels.

Roanoke was one of only five cities with higher retail sales. The state sample for sales was off 11.3 percent, the first double-digit decline for any month since April 1961, the bureau said.

When February's figures are tallied, bureau director Roy L. Pearson said he expects more reports of lower economic activity for the state. But the end of the Persian Gulf War should bring "a clear upward move in consumer confidence in March," restoring consumer spending habits to a more normal pattern, he said.

Pearson forecast an end to Virginia's recession in the second quarter, "led by a moderate but clear rise in consumer demand." The recovery should gain momentum in the third quarter, he said.

The projection is of "significantly slower growth" for the state in the 1990s, wrote David G. Garraty of Virginia Wesleyan College.

Roanoke and Lynchburg are expected to have smaller growth rates, lagging behind national averages, he said.

Garraty predicted Roanoke's total employment will grow by 1 percent in the 1990s, down from 1.7 percent in the last decade. He expects total personal income to rise by 1.8 percent, down from 2.2 percent; per capita income, 1.2 percent, down from 2.2 percent; and total population, 0.6 percent, up from a flat performance in the 1980s.

by CNB