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Still, more jobs are needed to lower painfully high unemployment and boost pay for those who are working. Wages have barely kept up with inflation over the past year, which has led consumers to pull back on spending. Consumer spending is critical because it drives roughly 70 percent of growth. But the economy isn't growing quickly enough to encourage more hiring. The economy grew at an annual rate of just 1.9 percent in the first three months of the year. Most economists don't expect growth picked up in the April-June quarter. And some predict that it weakened. The Federal Reserve downgraded its outlook for the economy this year. It now expects growth of just 1.9 percent to 2.4 percent for 2012. That's half a percentage point lower than the range it estimated in April. The Fed also says the unemployment rate won't fall much further this year than it has already.
[Associated
Press;
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