Tuesday, February 17, 2009

Jobs created and "saved"

Jeff Mapes of the Oregonian zeroes in on some interesting wiggle room in the language being used to measure to success anticipated with the passage of the President's stimulus package.

This just out from the White House: a state-by-state listing of the jobs the Obama administration expects to "create or save" as a result of the $787 billion economic stimulus package. [...] Of course, "created or saved" is kind of a nebulous term. How do you define a "saved" job?

Mapes identifies one reason the debate will never end as to whether the stimulus "worked" or not, as if it existed in a vacuum, and as if the answer were a simple binary "yes" or "no."

Part of the argument is so obvious as to be academic. If Project X doesn't get funded but for the stimulus package and it requires Y number of positions over the course of a year and costs Z dollars, one can rightfully add Y to the total number of jobs created.

Where it gets more abstract is to calculate how many jobs were created (or might well have been cut) on account of the tax cuts. This, if you believe in the trickle down theory that if you give rich people more money, they hire more people, (presumably even more than would be hired spending the money on some infrastructure project).

Slightly less intangible is the real trickle down effect present when the people [Y above] sink their wages back into the economy. How does one calculate the number of jobs created or saved in other sectors (eateries and other merchants) because these road builders, educators, etc have disposable income as opposed to being unemployed.

Fun math. Speaking of which. I am curious how they arrived at the number 44,000 jobs for Oregon, other than simply using a calculator. Which is what I did. 3.5 million total jobs X 1.25%* (Oregon population relative to US proper)

= 43,982 jobs for Oregon

So we know from the get go that depending on what the stimulus is being spent on, Project X costing Z will yield Y jobs (see above). But not every outlay in the stimulus package will be equally effective.

I know that Mapes was asking about a definition, and I swerved into mathematics. But once we get a real breakdown of how much money is going for what in Oregon, we won't even begin to be able to speculate on how many jobs will be created (or saved!)

*I used 2008 population estimates from Wikipedia.

: US + territories

3,954,037 : Puerto Rico

173,456 : Guam

108,448 : US Virgin Islands

84,546 : Northern Marian Is.
Oregon pop.
57,291 : American Samoa
3,790,060 301,608,597
: TOTAL US proper

% Oregon

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