Here Are Some Figures Compiled by Economic Seers for 1988

The next year, according to economic seers, should be a time of relatively flat economies at both the national and local level. Overshadowing all is a widespread uncertainty about the stock market, federal monetary policy, government budget-balancing and consumer confidence.

A synthesis of several national and local economic forecasts--including by Merrill Lynch, Security Pacific and First Interstate banks, the University of Chicago, the Chapman College Center for Economic Research and Duff & Phelps--paints this picture of the coming year’s economy:

A national inflation rate of about 4% (Chapman, University of Chicago).

A local inflation rate ranging from 4% (Chapman) to 5.6% (First Interstate).

A real (adjusted for inflation) Gross National Product growth of 1% (Chicago) to 2% (Duff & Phelps).

A real increase in the county’s gross product of 2.4% (Chapman).

National employment up about 1%.

County employment increases ranging from 2.5%--contrasted with 3.6% estimated for this year (Chapman)--to 3.7%--contrasted with 5% this year (First Interstate).

Decreases in construction, aerospace and defense-related manufacturing employment.

Increases in retail, wholesale, services, government and transportation employment.

A slight nominal increase in median family income in Orange County. Chapman predicts a pessimistic low of 4.8%, while First Interstate Bank optimistically looks for a 9.7% increase. Adjusted for their predicted inflation rates, these fall to real increases of 0.8% for Chapman and 4.1% for First Interstate.

A nominal taxable sales increase in the county of 6.4% (Chapman) to 10.1% (First Interstate). These fall to about 0.5% (Chapman) and 1% (First Interstate) when adjusted for inflation and the effect of the slower employment growth.

A decline in residential, commercial, retail and industrial construction in the county.

An increase in local housing prices as the supply of homes on the market dwindles. Chapman’s forecast says resale homes could inflate in price at 10% per year or more for the first time in a decade.