The U.S. economy expanded at a 3.5% annual pace in the third quarter, the Commerce Department reported today, but what does that mean for a beleaguered commercial real estate industry suffering from rising vacancies and falling rents?

While it’s another guidepost that the economy is headed in the right direction, the third-quarter expansion that followed four quarters of contraction was aided in large part by massive federal stimulus, cautions Bob Bach, chief economist for national real estate brokerage firm Grubb & Ellis.

“Next year will be more critical as we see if the economy can continue going without the training wheels provided by the government in the form of stimulus spending, federal programs to keep interest rates low and cash-for-clunkers,” says Bach. “Analysts expected a big jump in third-quarter GDP, and that’s what we got.”

An uptick in consumer spending and private investment helped propel GDP growth in the third quarter, explains Victor Calanog, director of research for New York-based Reis.

“If we exclude government expenditures and net exports, consumer spending and private investment grew at an annualized rate of 3.55% in the third quarter, whereas it fell at an annualized rate of 3.68% in the second quarter, and a massive 8.52% in the first quarter,” according to Calanog

The question many economists are now grappling with is whether the big third-quarter uptick in GDP will be short-lived given the financial pressures weighing on consumers and a national unemployment rate of 9.8%.

“There are doubts as to whether this growth trajectory is sustainable once we remove the influence of government programs like cash for clunkers, but few would argue that we’re in a better place today than over the first half of 2009,” emphasizes Calanog.

For commercial real estate, the key to any meaningful turnaround hinges on job growth. Since December 2007, the U.S. economy has shed nearly 7.2 million jobs.

The Department of Labor reported today that the number of people filing for state unemployment benefits for the first time fell by 1,000 last week to seasonally adjusted 530,000, which is still quite high by historical standards. Economists had expected new claims to drop by 6,000 for the week to 524,000. Meanwhile, the four-week average of new claims fell 6,000 to 526,250.

“This suggests that the labor market is on a very slow trajectory toward recovery,” emphasizes Bach. “Taken together, these two new data points [GDP and new jobless claims] don’t tell us anything we didn’t already expect. I don’t think it changes the outlook for commercial real estate or the broader economy.”

The good news is that the weekly jobless claims figure has fallen to its lowest level since January, a strong sign that the labor market is stabilizing but at an incremental pace, according to Calanog.

“Some geographical areas may post recovery faster than others,” Calanog says, “but since this recession is deeper and much more broad than any we’ve seen since the Great Depression, I expect labor markets to take at least 18 to 24 months to recover.”

The low end of Calanog’s estimated recovery period accounts for the possibility that employers who laid off workers “too fast” after the near collapse of the financial markets last fall may hire a lot of them back once business activity accelerates.

But if recent history regarding recession and recovery is any indication, the job market will be slow to recover this time around, points out Calanog. Fifteen out of the 21 months following the end of the last recession in November 2001 were marked by job losses, not job gains.