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Examining Government's Job-Creation Numbers

ROBERT SIEGEL, host:

From NPR News, this is ALL THINGS CONSIDERED. Im Robert Siegel.

The White House issued a progress report late today on the government effort to stimulate the economy. Vice President Joe Biden, who has the stimulus portfolio, says that so far more than 640,000 jobs are directly traceable to stimulus spending.

Vice President JOE BIDEN: The Recovery Act is operating as advertised, but wasnt advertised as the only horse to carry the sleigh, to get us out of this ditch, but to play an incredibly important role.

SIEGEL: The vice president says the Obama administration is on track to meet its promise of creating or saving some 3.5 million jobs by the end of next year.

NPR White House correspondent Scott Horsley joins us now to talk about the new numbers. Hi, Scott.

SCOTT HORSLEY: Good to be with you, Robert.

SIEGEL: How did the administration arrive at this figure of more than 640,000 jobs?

HORSLEY: Well, as part of their transparency effort, the White House has asked every local government, private contractor, non-profit group, anybody who got a sizeable chunk of stimulus dollars was supposed to report back to the government how many people did you hire or keep on the payroll with that money. And they added all that up and came up with the improbably precise figure of 640,329 jobs that are directly traceable of the stimulus.

Now, half of those are teachers. There are police officers who wouldve been laid off, but for the federal government back-filling local coffers, about 80,000 jobs are in construction. The White House is really trying to answer the question, you know, where are the jobs for all this money that weve spent?

SIEGEL: But White House economists have also said that they think the stimulus is responsible for at least a million jobs. Why the different numbers?

HORSLEY: Well, this is really two different ways of accounting for it. Ive explained how the 640 figure is really just a matter of going out and counting actual bodies. But that doesnt cover everything. In fact, the people that had to report on this money account for only about 160 billion of the 340 billion that had been spent as of last month. It doesnt include the money, for example, that went to workers in the form of tax cuts. It doesnt include the extra unemployment benefits. And it doesnt include indirect spending, if, for example, a contractor thats building a new road went out and bought some asphalt and then the asphalt company had to hire somebody.

SIEGEL: Hire somebody.

HORSLEY: It doesnt include that. So what the White House economists do is they take a model and basically say, well, if weve pumped $340 billion into the economy, we just reckon its created about a million jobs and these arent necessarily jobs that you can follow the dollar directly from the U.S. Treasury into someones paycheck, but its not an unreasonable estimate of how many jobs are out there.

SIEGEL: Well, we have these numbers coming out of the White House today. Earlier in the week we had numbers showing gross domestic product that was increasing in the last quarter, but the unemployment rate keeps going up. Its nearing 10 percent now. And every month we get a report of hundreds of thousands more jobs lost.

HORSLEY: Yeah, and thats the real challenge here, both for the people who are out of work and also for the politicians who are trying to explain whats going on here. You have to remember those monthly jobs numbers are net. Every month a lot of people are hired, a lot of people are laid off, you add them together and if the layoffs outnumber the new hires, then you have a negative bottom line. And thats what weve had, really, since the beginning of last year.

Now, the pace of the job loss has slowed considerably and the administration wants some credit for that. At the same time, the president and his team always want to acknowledge the real economic suffering out there, and Vice President Biden did that today.

Vice Pres. BIDEN: My grandpop used to have an expression from Scranton. Hed say, and I mean this literally, it wasnt viewed as a joke, hed say, Joey, when the guy in Dickson City, a small town above Scranton, is out of work, its an economic slowdown. When your brother-in-law is out of work, its a recession. When youre out of work, its a depression. And its a depression for millions of American people. And were not going to be satisfied until we see a net creation in jobs in every monthly report. But were moving in the right direction.

HORSLEY: And thats the line the administration is trying to walk here, saying our efforts are helping, but we understand its not good enough yet.

SIEGEL: Now, Republicans in Congress who generally voted against the stimulus package have complained that it is not working to create jobs. How have they responded to the White House numbers today?

HORSLEY: Well, its interesting. The vice president was flanked today by a Republican Governor, Arnold Schwarzenegger of California, as well as a Democratic governor. And Schwarzenegger said, you know, this shouldnt be a partisan issue. It shouldnt be about Republicans or Democrats. It should be about jobs, jobs, jobs. But here in Washington it is very much a partisan issue. And the Republicans in Congress make hay every month when the job numbers comes out and say the stimulus isnt working and why not we do it our way?

SIEGEL: What does this say about the possibility of a second stimulus package?

HORSLEY: Well, the administration says its willing to consider all sorts of options and fine tuning and extending some of the major parts of stimulus that are due to expire, but theyre not really talking seriously about a big, new multibillion dollar stimulus.

SIEGEL: NPR White House reporter Scott Horsley. Thank you, Scott.

HORSLEY: My pleasure. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

Scott Horsley is NPR's Chief Economics Correspondent. He reports on ups and downs in the national economy as well as fault lines between booming and busting communities.
Prior to his retirement, Robert Siegel was the senior host of NPR's award-winning evening newsmagazine All Things Considered. With 40 years of experience working in radio news, Siegel hosted the country's most-listened-to, afternoon-drive-time news radio program and reported on stories and happenings all over the globe, and reported from a variety of locations across Europe, the Middle East, North Africa, and Asia. He signed off in his final broadcast of All Things Considered on January 5, 2018.