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

DATE: TUESDAY, May 4, 1993                   TAG: 9305040134
SECTION: BUSINESS                    PAGE: B5   EDITION: METRO 
SOURCE: George Kegley
DATELINE:                                 LENGTH: Short

VA. RECOVERY MAY TRAIL REST OF SOUTHEAST

After leading the Southeast for much of the 1980s, Virginia will be "a region laggard" until its decline in durable manufacturing, military and federal employment is completed, according to an Atlanta forecast.

The state's "adjustment" probably will take a few years, said the fourth-quarter Southeast State Indicators from the Economic Forecasting Center at Georgia State University. The center is directed by economist Donald Ratajczak.

Despite national gains last fall, "economic conditions in Virginia remain fragile," the study said. Virginia's leading indicators rose strongly in 1992's fourth quarter, it said, "but they have not yet definitely signaled a sustainable expansion."

The less-than-optimistic findings also show:

Virginia's manufacturing work week declined in the fall, while most states showed record levels. Initial claims for jobless benefits showed little change. Commercial bank deposits fell for the fifth consecutive quarter, but sales-tax receipts were up strongly, providing much of the gains in the indicators.

Any rebound in construction is probably two quarters ahead.

Two important barriers will prevent rapid advance:

Military-base closings have been small but painful, and reduced military activity will affect the state profoundly. Frozen wages for government workers in Northern Virginia will be even more painful.

Declining durable-goods manufacturing includes weak rail-equipment production and decreasing electronics and fabricated metals manufacturing.

by CNB