Oct. 30--With gross domestic product soaring at a higher-than-expected 3.5 percent annual rate, it's practically official: The recession is over.

But just wait till next week.

The first Friday in November brings an employment report that could show the nation's jobless rate pushing past 10 percent for the first time since the early 1980s.

Recovery from the now-ended downturn will be a long, slow affair, most economists agree. And just as with the two previous recoveries before it, this one could fall way short on job creation.

As a consequence, Thursday's "good news" had a decidedly, "Yes, but" feel to it.

Yes, as economist Asha Bangalore of the Northern Trust Co. declared, "The recovery is here now."

But, as she also declared, "There's going to be a jobless recovery."

Reality check No. 1 can be found in the details of Thursday's upbeat GDP report. Factor out government stimulus spending, and Federal Reserve efforts to pump money into the financial system, and not much is left to celebrate. "If we didn't have the government aid, the economy would be at best flat," explained Gus Faucher, director of macroeconomics at Moody's Economy.com.

Those first-time homebuyer tax credits and "cash for clunkers" car-selling schemes do indeed get money flowing -- partly by accelerating sales that would have happened in the future anyway.

Reviving the labor market will require a more fundamental turnaround.

Employers need to be convinced the economic recovery is here to stay. And even if they clear that psychological hurdle, their first move will be expanding hours for existing workers rather than hiring new ones. "There are huge amounts of underemployed," Faucher pointed out.

He and Bangalore expect the unemployment rate to clock in at 9.9 percent next Friday, and then keep rising into next year. Northern Trust expects a peak of 10.7 percent in mid-2010, meaning the economy will shed additional jobs by the hundreds of thousands. Even at the end of next year, the jobless rate will hover near 10 percent.

In previous recessions from the 1950s through the early 1980s, manufacturing led swifter recoveries. But the hiring that goes along with rebuilding industrial inventories these days just isn't enough to move the needle in an economy less focused on making things.

Consumer spending counts for much more economic activity, but that's expected to pick up slowly. After the sobering wake-up call of a housing bust, credit crunch and career-killing job market, "Consumers are in no position to go on a spending spree," said economist Sung Won Sohn of California State University. "With the stimulus from the government programs diminishing, the weakness in the private sector points to the possibility of a double-dip recession later in 2010."

The dreaded "double dip." That's when the economy tries to gain altitude, then flops back to earth, wallowing around in the dirt some more before stretching its wings again. It happened in the Rust Belt calamity of the early 1980s.

Exports could help head off a double dip. Thursday's GDP report reflected a 14.7 percent annualized increase, although clunkers-inspired auto imports drowned out the impact. In the months ahead, watch for a significant contribution as a weak dollar and rising demand from the developing world makes U.S.-made products more attractive.

Attention, China: Time to place those orders for tractors and bulldozers.

gburns@tribune.com

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