Stimulus creates 13,000 jobs in Maine

0

LEWISTON — About 13,000 jobs have been saved or created in Maine because of the economic stimulus package enacted in February 2009, according to a recently released quarterly report from the White House. Between 2.2 million and 2.8 million jobs were estimated to be saved or created nationwide.

The report, which reflects spending through the end of March, was issued by the Obama administration’s Council of Economic Advisers and claims to be just a rough estimate of state-by-state employment numbers. Results from three economic models were averaged to come up with the estimates, which are different from how state governments are required to report stimulus-based job creation.

“The federal government requires us to report on direct jobs funded by recovery act dollars. The report (from the White House) is more based on higher-level economics; it counts multiplier factors,” said Ryan Low, commissioner of Maine’s Department of Administrative and Financial Services. “That’s not something the state is responsible for. In fact, they specifically don’t want us counting multiplier effects.”

For example, a $9.6 million highway reconstruction project on Route 196 in Lisbon has only resulted in 2.34 jobs, according to the state of Maine’s stimulus-tracking Web site. That’s in part because only $63,000 have been spent on the project so far. But the state numbers don’t take into account any ripple effects from that spending, like the federal report does.

Advertisement

“We’re not responsible for calculating the impact if the construction company went out and bought a bunch of steel and that meant more people were employed from that business. The federal report takes that kind of stuff into consideration,” said Low, who added that about $783 million in stimulus money had so far passed through Maine state government.

Low said the White House figures were within the realm of possibility.

According to state-reported job numbers, the stimulus resulted in about 1,000 direct jobs saved or created between October and December 2009. Low said new numbers reflecting the most recent quarter would be released soon.

Scott Moody, the chief economist at the Maine Heritage Policy Center, a conservative-leaning think tank, said he wouldn’t quibble with the number of jobs federal officials say the stimulus saved or created, but would argue their value.

“I didn’t look at the technical side, in terms of the models they used and what not,” he said. “The biggest problem with the whole stimulus package saving jobs is, I don’t think they’ve really made the distinction about what kinds of jobs they are saving.”

Moody said that recessions are a fact of life and that the jobs created or saved by the stimulus spending were mostly in the public sector.

“What the real problem is, when you look at Maine, you see the free fall in the private sector employment, and you don’t see the same drop in public sector employment,” he said. “That is just exacerbating this long-term problem we have in the state, which is government employment at the expense of the private sector.”

Kit St. John, executive director of the Maine Center for Economic Policy, a liberal-leaning public policy group, said the federal job estimate for Maine was reasonable.

“This is not an exact science,” he said, adding that the federal numbers provided a more comprehensive perspective on the overall impact of the $787 billion stimulus package in Maine.

The stimulus spending can be roughly broken down into three similarly sized spending areas, St. John said — tax cuts, state aid and project-based awards in a variety of areas, including transportation, weatherization and energy assistance.

“This downturn has been very serious, but it appears to have been lightened considerably by the strong federal intervention. What we have to say about (the stimulus) is that it prevented the loss of more jobs, and we can be grateful that Maine’s unemployment rate is only 8.2 percent now, despite a national level of 9.7 percent,” St. John said. “It’s not as bad as the early ’90s, this recession, it now appears, though it was close, and it was worse nationally.”

There were about 58,000 unemployed Mainers in March, according to the most recent report from the Maine Department of Labor. That’s up about 1,800 people from last year.

For more information about stimulus spending in Maine, visit www.maine.gov/recovery.

rmetzler@sunjournal.com

Advertisement