Stimulus plan's job numbers get 2nd look

WASHINGTON -- Looking for a job or fear losing your own? President Obama says he can help 3 million to 4 million of you.

That could be optimistic, however. The Congressional Budget Office says Obama's economic stimulus package of spending programs and tax cuts would create 1.2 million to 3.6 million jobs. The economic consulting firm IHS Global Insight puts the number at 2.6 million.

Most of the jobs would only replace those lost to the recession. Even with the stimulus package, the administration estimates that unemployment would be 7% at the end of 2010 — barely below the current 7.2% rate.

As the Senate began debate on the package Monday, much of the focus turned to jobs: How many there would be, how quickly they could be created, how much they would pay and with what benefits, and who would get them.

"The bottom line is this: You've got a piece of legislation that creates jobs," White House spokesman Robert Gibbs said after several questions. "The latest statistics based on the economic reports show that 90% of these jobs are private-sector jobs."

Republicans in Congress have criticized elements of the emerging package for not creating enough jobs. House Minority Leader John Boehner and others cite investments that do not immediately create jobs, such as an increase in the size of Pell grants for low-income college students.

Others say investing in education would be an indirect benefit by helping students compete for better jobs in the future. Indirect benefits will be "fairly widely dispersed through the economy … so all kinds of jobs will be created," says Chad Stone, chief economist for the liberal Center on Budget and Policy Priorities.

As an example of jobs that could be saved, Gibbs cited 27 police recruits in Columbus, Ohio, who were laid off last week before graduating from the police academy.

The quickest infusion of money into the economy under the two-year, $819 billion House bill or $885 billion Senate version would come from aid to states, help for the unemployed, and tax cuts for consumers and businesses. Those produce jobs indirectly.

Then there are jobs that would be created as a direct result of new spending on education, health care, renewable energy sources and public infrastructure such as highways and bridges. Those could take longer to materialize — well into 2011, the White House says.

Mark Zandi, chief economist at Moody's Economy.com, estimates the construction industry would see a 6.6% boost in jobs, by far the largest of any industry. All states would be helped, he says; those hardest hit by losses in housing, financial services and the auto industry — such as Florida, New York and Michigan — would benefit the most.

The administration's estimate comes from a report last month by two of its leading economists. Christina Romer, chairwoman of the Council of Economic Advisors, and Jared Bernstein, Vice President Biden's top economic adviser, project that 1.5 million jobs would be created directly and 2.2 million as a result of indirect improvements in the economy. They say the figures are subject to large margins of error.

"The uncertainty is surely higher than normal now because the current recession is unusual, both in its fundamental causes and its severity," Romer and Bernstein wrote. The largest increases, the report says, would be in construction, manufacturing, retail trade, and leisure and hospitality, which employ large numbers of low- and middle-income workers.

Yet others say the legislation needs to help those with the least schooling and job skills. "We know these people are going to take the biggest beating during the downturn," says Harry Holzer, a public policy professor at Georgetown University.

The administration report projects that women would get about 42% of the jobs created or saved, even though they lost only 20% of the jobs in the recession.

Obama has noted the importance of creating "green jobs" in the field of renewable energy. A middle-class task force he created last week will hold its first meeting in Philadelphia later this month on the topic.

A coalition of labor unions will release a report today questioning whether many of them would be low-paying jobs without benefits. "Not all green jobs being created are good jobs," says Noreen Nielsen of the labor group Change to Win.