The economy is slowly improving, but hopes for accelerated growth “have been dashed” by sluggish job creation. That’s the conclusion of a new report by the Center for Business and Economic Research (CBER) at the University of Tennessee.

Not all the news is bad. Unemployment is falling, businesses are creating jobs, the housing market is addressing its longstanding pressures and the financial health of states is improving. All those are key indicators of economic recovery, according to CBER’s mid-year Tennessee Business and Economic Outlook report.

"Despite slower-than-desired growth, the economy is on much firmer footing today than it was a year ago," said Matt Murray, associate director of CBER and the report's author.

The report predicts subpar, but sustained, economic growth into 2014.