On the final business day of October, the Obama Administration released the most complete report yet on how the Recovery Act is performing in the greater U.S. economy.
Of the approximate $160 billion spent through the end of September, the White House says the Recovery Act can be credited with “directly creating or saving about 650,000 jobs.” About 325,000 of those jobs are in education, and over 80,000 are in construction.
Those numbers involve direct and full-time employment according to the metrics used, and the official statement made a point that the number was most likely above 1-million with “indirect” job creation, as well as the impact from entitlements like unemployment insurance, as well as tax cuts.
"The 1-million saved or created has been out for a while,” Vice President Biden’s chief economist Jared Bernstein told CNBC. “If you look at these numbers through the economy, that's the number saved or created."
The White House very much wants this number to be viewed in the context of Thursday’s announcement that third quarter GDP showed a growth rate of 3.5 percent.
“Without the economic recovery act, it's very unlikely that this economy would have expanded at all this last quarter,” Vice President Joe Biden said Friday. “It may even have contracted.”
With the U.S. unemployment rate closing in on 10 percent, the White House is facing pressure to deliver on what many believe to be the most important measure of a successful stimulus—jobs.
Today’s data shows California, with the nation’s 4th highest unemployment, boasts the largest number of jobs saved or created with stimulus spending: more than 100,000.
"It's all about jobs, jobs, jobs," California Governor Arnold Schwarzenegger said during a press briefing. "That is the most important thing, to create those jobs and put people back to work."
Early criticism of data released by the Recovery Board surrounded the failure to address unemployment in the areas of the country hurting most. The White House claims today’s data will show "the highest unemployment rates nationwide reported 25 percent more jobs created and saved per capita than the nation as a whole."
Here’s how the states with the highest unemployment have faired with their stimulus spending:
- With $5.2 billion in funds obligated, Michigan created or saved more than 22,000 jobs. Top recipients included the Michigan departments of Transportation and Education.
- With almost $1 billion in funds obligated, Nevada created or saved 5,667 jobs. Nevada's Clark County School District received the most funds.
- Rhode Island created 2,012 jobs with a total of $673 million going to the state. Of that, $125 million went to its Department of Transportation.
Today’s data dump included a total of 130,362 reports: 13,080 from federal contracts, 116,675 on grants, and 607 on loans.
The top stimulus contracts went to nuclear cleanup. Savannah River Nuclear Solutions got $1.4 billion dollars for its work in Aiken, SC. The largest grant goes to California's Office of Planning and Research - $4.4 billion to support education. Solar power firm Solyndra was given the largest loan in the amount of $535 million.
“Analysis by both the Council of Economic Advisers and a wide range of private and public-sector forecasters indicates the Recovery Act contributed between 3 and 4 percentage points to real GDP growth in the third quarter, suggesting that in the absence of the Recovery Act, real GDP would have risen little, if at all, this past quarter.”
Critics have pointed to the rising rate of unemployment as a symbol of the Recovery Act’s failure. When next week’s government jobs report is released, the expectation is that the unemployment rate might rise as high as 9.9 percent.
Bernstein says, that is not the correct way to view the Recovery Act.
“The Recovery Act is shaving about two percentage points off unemployment,” Bernstein told CNBC. “About 10-percent unemployment is unacceptably high. (But) I think we can all agree that about 12 percent is a lot worse.”
Other critics have pointed to inaccuracies in the reporting process, saying that the jobs numbers are not reliable.
Again, the White House is quick to respond, saying that the historic amount of transparency is unprecedented and that the process is a work in progress—but constantly improving.
“We have made a lot of progress in the subsequent days sharpening the data so that visitors to the site (recovery.gov) can be confident in what they see,” the White House said in an official statement.
About 22-percent of the $787 billion in stimulus funds has been spent so far.
To see the actual numbers, go to recovery.gov, and the updates will be available at some point on October, 30.
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