A winter surge in Covid-19 cases driven by the Omicron variant is prompting economists to downgrade U.S. and global growth expectations in the early part of 2022 as businesses struggle with absenteeism and consumers stay home to avoid getting sick.

Several economists have recently cut forecasts for the U.S. following early signs that a sharp rise in cases has already disrupted parts of the economy. Airlines canceled thousands of flights over the Christmas holiday weekend and into Monday, in part due to Covid-19-driven staff shortages.

The federal Centers for Disease Control and Prevention reduced on Monday the amount of recommended time that infected people who are asymptomatic should isolate to five days from 10 as more research is done and thinking evolves on how best to manage the pandemic.

In Europe, leaders reviewed whether to put in place new limits on activity as New Year celebrations approach. The U.K. government decided against tightened restrictions after reviewing hospitalization data, but Health Minister Sajid Javid said people should celebrate New Year’s Eve outside if possible.

U.S. officials are seeking ways to ease pressure on hospitals while also limiting business disruptions.

Mark Zandi, chief economist at Moody’s Analytics, downgraded his first-quarter U.S. gross domestic product forecast to 2.2% growth from 5.2% as he “can see the economic damage mounting going into the first quarter.”

Mr. Zandi pointed to softer spending on travel and cancellations of sporting events and Broadway shows due to the disruptive Covid-19 outbreak.

“It feels like a very similar dynamic as when Delta hit,” Mr. Zandi said, referring to the Delta variant of Covid-19 that gripped the U.S. in the summer. He initially expected economic growth of 6.1% headed into the third quarter; in the end the economy expanded at a 2.3% pace from July to September.

The economy is estimated to have grown at an annual pace of 7.6% in the current fourth quarter, according to the Federal Reserve Bank of Atlanta’s GDP forecasting tool.

Economists have struggled to predict the impact of Covid-19 on economies throughout the pandemic, including in the U.S., where changes in the labor market have surprised both the government and forecasters. Still, they expect Omicron will push economic activity from the first quarter into the second, with a smaller impact than from prior waves of the pandemic. The Federal Reserve earlier this month forecast that the U.S. economy would grow by 4% next year.