Estimate of Mass. stimulus jobs uncertain at best
State officials overseeing the federal economic stimulus program in Massachusetts say they have no idea how the White House came up with one key pledge — the promise to save or create 79,000 jobs in the state.
They say they’re not even sure how to measure saved jobs — and fear the jobs figure sets an unrealistic yardstick against which the success or failure of the program will be measured.
“The federal estimate of 79,000, we really don’t know what’s behind that, we just plain don’t,” Jeffrey Simon, director of infrastructure investment in Massachusetts, told The Associated Press.
“I’m not saying it’s not 79,000, but I just don’t have any way of knowing that,” he said.
Simon and his counterparts overseeing the distribution of stimulus funds in Massachusetts said concerns about the state jobs numbers were raised at a meeting last month in Washington between state and federal leaders.
Massachusetts Undersecretary of Administration and Finance Jay Gonzalez also attended the Washington meeting. He said other states complained that issuing job estimates undercut the administration’s vow of transparency because it was unclear where the estimates came from.
Gonzalez said he was asked at one point how he might come up with a jobs estimate and pointed federal officials to a state task force report, but cautioned them the estimate was very rough and came with “qualifications all over it.”
He said he was surprised when the state was presented with the estimate of 79,000.
“We have no idea where that number came from and now we’re going to be measured against it,” Gonzalez told the AP. “They haven’t even decided yet how they are going to require that we measure new and retained jobs.”
Job creation has been a key selling point of the $787 billion federal stimulus package. The Obama administration said the stimulus package will save or create 3.5 million jobs nationwide.
Critics say the numbers are fuzzy, particularly when it comes to saved jobs.
In a one-page explanation on the federal stimulus Web site, the administration said it arrived at the state numbers by using an average of three different methods of estimating job growth.
The first looks at the total working-age population of each state. If a state accounted for 10 percent of the country’s total working age population, it was allotted 10 percent of the national job impact of the stimulus package.
The second uses a similar method based on 2007 employment records, before the beginning of the current recession.
The administration said the two methods are reasonable because states with larger populations will get a proportionately larger share of tax cuts, education spending and fiscal relief from the stimulus package.
The third method is based on the industrial composition of a state. If a state had 10 percent of the nation’s manufacturing jobs, it was assumed to get 10 percent of the manufacturing jobs created by the stimulus package.
Despite all the calculations, the administration concedes that “state jobs estimates are inherently more speculative than overall estimates.”
Federal and state officials also may rely in part on a “multiplier effect” when it comes to counting heads. A multiplier effect helps boost the job count by adding in secondary jobs not created by direct aid.
For example, if federal stimulus money keeps construction jobs in an area, and those workers allow a local diner to hire an extra cook or waitress, then those additional jobs could be counted as saved jobs.
For those working at the state level to get the federal dollars flowing as quickly as possible, the job estimates are proving to be something of a distraction.
“We’ve got our hands full understanding what the bill does, let alone trying to figure out how many jobs,” said Simon.