The U.S. economy grew at a slower pace during the first three months of the year than in 2011′s fourth quarter, the Commerce Department announced this morning.
In its initial reading of first-quarter GDP, Commerce says the U.S. grew at a rate of 2.2%, down from 3% in the previous quarter. Economists had expected stronger growth, ABC News noted, with predictions ranging from 2.5% to 3.2%.
One analyst told ABC News that the slowing GDP raised concerns that the country could be running out of time to reduce unemployment. In previous economic downturns, it took 12 to 20 months for unemployment to fall to normal levels once the economy started growing again.
It has now been 34 months since the U.S. emerged from the last recession, and unemployment remains high, the analyst pointed out.
But other analysts cited by ABC News sounded a more positive note, predicting stronger GDP growth during the latter two quarters of this year as companies continue to report strong earnings and hiring continues to pick up, albeit slowly.
One better-than-expected figure in the GDP report was for consumer spending, which expanded at a 2.9% rate in the quarter, according to the Commerce Dept. But that was offset by lower government spending (down 3%) and less inventory building by businesses.
Joel Naroff, chief economist at Naroff Economic Advisors, predicted overall 3% GDP growth for 2012, almost twice the rate of last year, and equal to that of 2010, according to the Associated Press.