Friday, October 30, 2009

The Act in Action: New Report Shows Recovery Act Creating Jobs Throughout the Nation

The Act in Action: New Report Shows Recovery Act Creating Jobs Throughout the Nation
Posted by Jared Bernstein on October 30, 2009 at 10:46 AM EDT
Good news, folks. The Recovery Act is working, and so are over one million people whose jobs have been saved or created by the American Recovery and Reinvestment Act.

But why take it from me when you can see it for yourself? Thanks to unprecedented real-time data collection by the independent Recovery, Accountability, and Transparency Board (RATB), you will soon (as in this afternoon) be able to visit and learn about the approximately 650,000 jobs directly created by part—and I emphasize that these 650,000 or so jobs are a subset of the more than one million—of the Recovery Act dollars at work in our economy.

Since that 650,000 is based off of about half the bucks at work in the economy so far, you can double it to get a rough estimate of the total jobs impact so far, getting you to over a million jobs, saved or created.

Can’t wait until this afternoon? Then watch this new video of real people doing real jobs supported by the Recovery Act.

Play/pauseMute/unmuteRewind and stop
Download Video: mp4 (125MB) .Here are the details. As of last month, there was about $340 billion in Recovery Act dollars at work in the economy, through fiscal relief to states, committed infrastructure projects (some in progress, some yet to start), tax cuts, unemployment benefits, small biz loans, and much more. According to both our estimates and those of independent analysts, this ramp up of the Act has created or saved about one million jobs so far.

Now, a little less than half that amount applies to direct spending projects for which recipients are required by Congress to report job information to the independent RATB. As you can see in the video above, we’re talking everything from construction workers, teachers, scientists, and more. After cleaning the data, and summing it all up, the board tells us that these direct jobs amount to about 650,000, located throughout the country.

The other half of the spending includes subsidized loans to small businesses, unemployment compensation, tax cuts, and other forms of Recovery Act support that doesn’t lend itself to direct job reporting so easily. The recipient reports also omit indirect jobs—those created when the directly hired contractor orders some cement, the school teacher orders classroom supplies, or when both of them spend their paychecks in the economy, generating more economic activity and jobs than would have occurred if they were unemployed (econo-types will recognize these as “multiplier effects”).

So that’s the story today, but there’s a lot more to come from the Recovery Act. Given that more than half of the Act’s funds have yet to be obligated or reflected in tax cuts, the fact that many funded projects have a lot more hiring to do, and the fact that these recipient reports account for around 650,000 jobs through the end of September despite all the omissions just noted, we are solidly on track to meet our goal of 3.5 million jobs saved or created by the end of next year.

So, a major hat-tip to the RATB for their path-breaking work and we thank all the recipients for providing us with this information.

But as we applaud these unprecedented efforts in transparency and this new confirmation that the Recovery Act is successfully creating jobs across America, we are also acutely aware that even the highest estimates of jobs created or saved by the Act only partially offset the extent of job losses since the recession took hold last year. For this reason, we plan to continue to squeeze every job out of every dollar left to spend in the Recovery Act, and to do so with the same level of transparency achieved thus far.

And we’ll keep you posted of our progress.

Jared Bernstein is Chief Economist to Vice President Biden, and Executive Director of the Middle Class Task Force

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