(RALEIGH) -- Federal Reserve officials said on Thursday that they are more pessimistic about prospects for economic growth and employment than they were two months ago. N.C. State University economist Dr. Mike Walden said unemployment is the main problem.

"We have seen improvement.  Most of the economic gauges are better now than they were two years ago, but just at a very, very slow pace," said Walden.  "During the recession eight million people became unemployed.  Now, we have six and a half million of those eight million people are still unemployed, so we've added some jobs but not nearly enough."

In an updated forecast, the Fed estimates that the economy will grow between 2.7 percent and 2.9 percent this year. That is down from its April estimate of between 3.1 percent and 3.3 percent.