Langevin says stimulus program created “thousands of jobs” in Rhode Island

Update:
On Oct. 21, 2010, we rated as Barely True a statement by U.S. Rep. James R.  Langevin that the federal stimulus program created thousands of jobs in Rhode Island. We have discovered that we misread a chart  at recovery.gov that showed the number of stimulus jobs created in Rhode Island.

This is a revised story that clarifies the number but does not change the ruling.

With the national and state economies both sagging, the effectiveness of the federal American Recovery and Reinvestment Act, better known as the stimulus bill, has been a focus of debate in this year’s congressional elections.

During a debate with Republican Mark Zaccaria on Oct. 14 on WLNE-TV, sponsored by the League of Women Voters, Langevin, a strong supporter of the stimulus program, said it had "created thousands of jobs here."

Debating Zaccaria two days later on the WPRI "Newsmakers" program, Langevin said:  "In Rhode Island, there were thousands of jobs that were created"  by the stimulus program.

We wondered: Has the stimulus program created thousands of Rhode Island jobs?

Trying to determine the employment effect of a specific government program can be difficult, but the Recovery Act included specific provisions that required the government to post online information detailing how much money was spent, where it was spent and on what. Included in that is the number of work hours paid for with stimulus money, expressed as the equivalent of a 40-hour-a-week worker.

The current Rhode Island number, posted at Recovery. gov, the federal website with the stimulus spending data, is 1,989.58.

But that’s for the three-month period from April 1 to June 30, 2010, not, as we initially reported, for the duration of the stimulus program, which started in February 2009.

So what’s the real number of new Rhode Island jobs created by the stimulus since February 2009? Laurie Petrone of the state Office of Recovery and Reinvestment, the official who tracks stimulus aid here, said it’s impossible to say.

When the program began, Petrone said, the federal government asked participating state agencies and employers to keep count of new jobs created by the stimulus. The first reporting period was for Feb. 17 to Sept. 30, 2009.

Contractors and agencies were to report the number of full-time and part-time work hours that stimulus money paid for. Those hours were then added up and the total converted into full-time workers.

For those first eight months, Petrone said the statewide jobs number for participating public and private sector employers was 1,960.82. For the next period, Oct. 1, 2009 to the end of 2009, it was 1,900.86.

The reported figure for Jan. 1, 2010 to March 31, 2010, dropped to 530 because many Rhode Island agencies and contractors weren’t able to file timely reports due to the late-March flooding in the state, Petrone said.

Then there’s the 1,989.58 figure for the April 1, to June 30, 2010 period, which is the one on the Recovery,gov website now. Because many stimulus programs are reaching the end of their funding, the quarterly job numbers may start to go down, she said.

Petrone said it’s hard to determine how many new jobs were created and how many preserved because there was no clear definition of what represented a new job.

At the beginning of the program, she said, any work that was paid for in the first eight months was counted in the total. If the job carried over into the next quarter, it  was counted as a stimulus job then as well.

But that means you can’t get a cumulative picture by adding the quarterly reports together, she said, because you would wind up counting carried-over workers twice. Each quarterly report has to be looked at as a "discrete snapshot" by itself.

Petrone said that means there is no way to know how many of the 1,900.86 jobs in the second reporting period from Oct 1-Dec. 31, 2009 included workers who would have been laid off but were not, new workers who would not have been hired without the stimulus money, or workers whose existing jobs carried over from the previous period. The same applies to the next two reporting periods.

There  were other problems. Petrone said states and contractors were confused over how to classify new and retained jobs. She gave the example of a state agency that got a stimulus grant and used it for a specific project that added hours to an existing part time worker’s duties.

"Is that a new job, or a saved job, or a retained job?" Petrone asked. The guidelines were unclear.

In December 2009, in response to confusion and complaints about the reporting process, federal Office of Management and Budget Director Peter R. Orszag told reporting entities to avoid any "subjective judgment on whether jobs were created or retained" and just  report hours worked, in the equivalent of full-time jobs, that were financed by Recovery Act funds.

Langevin spokeswoman Joy Fox said the Recovery.gov figures show only part of the program’s effects. It doesn’t count the effect of tax cuts and secondary hiring caused by the increased economic activity the stimulus generated.

She pointed to a July 14 analysis by the president’s Council of Economic advisers, which estimated that, overall, the stimulus program has created or saved 11,000 jobs in Rhode Island.

The council’s report used a broader definition than Langevin did, including jobs saved, not just created.

The council reached its 11,000 figure by estimating that 3.04 million jobs were saved or created nationally by the Recover Act. It then extrapolated jobs numbers for each state.

The council defends its methodology but cautions that the state numbers are "inherently more speculative and uncertain."

We can’t determine exactly how many  stimulus jobs were created in Rhode Island. Even Petrone, the state official keeping tabs on stimulus spending, can’t determine that. Nor can Langevin.

The highest quarterly report shows 1,989.58 jobs actually created. It’s close enough to 2,000 to be literally true, but, in our opinion, less than "thousands" would imply.

For those reasons, we rate his claim Barely True.

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