Dim Look for Economic Growth

Overall, the economists in the Journal survey dimmed their outlooks for economic growth and for two critical gears of the stop-and-go recovery that have yet to engage: housing and jobs.

The main reason U.S. companies are reluctant to step up hiring is scant demand, rather than uncertainty over government policies, according to a majority of economists in a new Wall Street Journal survey.

Economists have grown gloomier about the second half of the year, and marked down their forecasts from earlier ones. Nevertheless, they still expect the economy to rebound in coming months and perform better than in the disappointing first half.

Gross domestic product grew just 1.9 percent in the first quarter at a seasonally adjusted annual rate. Economists in the poll expect second-quarter GDP growth to remain at 1.9 percent.

Economists ratcheted down their growth forecasts for both 2011and 2012 from previous months, to a pace insufficient to tame the unemployment rate, now 9.2 percent.

- Courtesy of Wall Street Journal, Phil Izzo