Economic Growth Expected, But Can It Be Sustained?

ALAN ZIBEL

WASHINGTON (AP) — The Great Recession may be over, but the U.S. recovery is just beginning — and it doesn't promise to be much easier.

Economists forecast America's total output grew at an annual rate of 3.3 percent between July and September, after contracting for a record four straight quarters. That growth has been fueled by a huge influx of government cash, including a temporary tax credit for first-time homeowners and a $1.25 trillion Federal Reserve program to keep mortgage rates low.

Both efforts are likely to end by next summer, and the housing industry is already feeling it. New home sales in September unexpectedly fell 3.6 percent, the first decline since March and a distinct sign of weakness in a market that had rebounded strongly over the summer.

Homebuilders are traditionally big employers, but the industry isn't hiring yet because sales are still sluggish.

While the unemployment rate fell slightly in most metro areas in September, the trend was fueled by discouraged job seekers leaving the work force, according to government data released Wednesday. The rate fell in 223 of 380 metros, or almost 60 percent. The jobless rate rose in 123 areas, and was unchanged in 34.