Jul. 22--The Great Recession may be nearing an end. Sort of.

An index of leading economic indicators rose in June for the third month in a row.

A prescient New York economist nicknamed "Dr. Doom" says the recession could end later this year, although he warns economic pain will continue well into next year.

Here in Texas, a Federal Reserve Bank of Dallas forecaster says the state's 2009 job losses might not be quite as bad as expected, and that next year could bring modest job growth.

But let's not get too excited.

When the U.S. recession ends, the healing process is apt to be slow -- perhaps another jobless recovery. With unemployment expected to remain startlingly high through 2010, there's no guarantee the economy won't slip back into recession at some point.

As the nation goes, so goes Texas -- with one big difference. Since Texas has sustained less economic damage than the U.S. as a whole, the state's path back to health may be a bit less arduous.

"Given that it's been such a deep recession, it's going to take two or three years for the U.S. to recover to an extent that people say, 'Yeah, this is a pretty healthy economy,' " said Dana Johnson, chief economist at Comerica Inc., the Dallas-based financial services company.

"The main difference in Texas is that it hasn't been sinking for nearly as long as the rest of the national economy," he said. "It just creates an environment where it's a lot easier for people to regain their confidence and rebuild some prosperity."

Signs of life

Recent U.S. economic reports have been mixed, with sluggish consumer confidence, weak retail sales and flagging industrial production.

At the same time, credit markets have improved in recent months. Initial jobless claims, which economists watch closely for signs the recession is easing, have fallen from their peak in early 2009.

This week, analysts saw a potential sign of recovery in a 0.7 percent June increase in the U.S. leading economic index, which is compiled by the Conference Board, a New York-based business research group.

That was the third consecutive monthly increase for the index, which is made up of 10 components, including interest rate spreads, building permits, stock prices, manufacturing hours, initial jobless claims and the money supply.

"The lows from which we started make any improvement relative, but gains do signify a pending recovery," Kim Whelan, an analyst with a unit of Wells Fargo & Co., said of the leading index.

But the economy will take time to emerge from the longest recession since the Great Depression, analysts say.