The modest pace of the U.S. economic recovery has a silver lining, as the expansion shows signs of lasting almost twice as long as average.

Four years into the upswing, the economy isnt seeing many of the excesses that often presage the start of contractions. Inflation is slowing, not quickening. Household debt is shrinking, not expanding. The labor market is slack, not tight.

Pent-up demand also bodes well for the longevity of the recovery, which has averaged annual growth of about 2 percent since its start in June 2009. Confronted by elevated unemployment and a depressed housing market, Americans put off forming families, buying homes and acquiring cars. Now, with house prices rising and payrolls expanding more rapidly, their behavior is changing.

The current expansion can continue another four to five years, said Robert Gordon, a professor at Northwestern University in Evanston, Illinois, whos a member of the National Bureau of Economic Research committee that determines when recessions begin and end.

That would make this upswing the second longest on record, behind only the 10-year period that spanned the 1990s. The average since the end of World War II is just shy of five years, at 58 months.

Reflecting the slow, steady pace of the recovery, payrolls rose 175,000 last month, in line with the average over the past year, Labor Department figures released on June 7 showed.

If the economy keeps expanding for the next three to five years, earnings will go up and the stock market will go up, said Allen Sinai, chief executive officer of Decision Economics Inc. in New York. He said the Standard & Poors 500 Index may rise as high as 1,750 later this year and could hit 2,000 in 2015. The stocks benchmark was at 1,643.38 at 4 p.m. on June 7.

Anticipating stronger sales in the years ahead, Ford Motor Co. (F) will add capacity to build 200,000 more vehicles annually in North America on rising demand for F-Series pickups and Fusion sedans, the Dearborn, Michigan-based company said in a May 22 statement.

The sales and marketing guys are obviously very confident, because theyve asked for additional capacity and were providing it, Jim Tetreault, vice president of North America manufacturing, said in a telephone interview.

Economic growth will speed up to 2.9 percent next year and 3.2 percent in 2015, from 1.9 percent this year, according to Goldman Sachs Group Inc. in New York.

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U.S. Expansion Poised for Longevity