White House: stimulus on pace for 3.5 million jobs

The Obama administration defended its claim Monday that the $787 billion economic stimulus plan will save or create 3.5 million jobs before 2011, an assertion questioned by some economists and GOP lawmakers.

A report by the White House Council of Economic Advisers says the projections are based on conservative estimates and widely accepted assumptions. The 3.5 million job estimate remains valid, the report says, now that stimulus money is starting to pay for various projects throughout the nation.

The report says the analysis is based on what the CEA considers “the relatively conservative rule of thumb that a 1 percent increase in GDP corresponds to an increase in employment of approximately 1 million jobs,” the report says.

However, it also notes that every increase in the GDP does not translate into new jobs. Existing workers absorb some of the increased economic activity by working longer hours and being more productive, it says.

Models that predict the number of U.S. jobs with and without the stimulus still conclude that the bill will create or save 3.5 million by the end of 2010, the report says.

The Obama administration defended its claim Monday that the $787 billion economic stimulus plan will save or create 3.5 million jobs before 2011, an assertion questioned by some economists and GOP lawmakers.

A report by the White House Council of Economic Advisers says the projections are based on conservative estimates and widely accepted assumptions. The 3.5 million job estimate remains valid, the report says, now that stimulus money is starting to pay for various projects throughout the nation.

The report says the analysis is based on what the CEA considers “the relatively conservative rule of thumb that a 1 percent increase in GDP corresponds to an increase in employment of approximately 1 million jobs,” the report says.

However, it also notes that every increase in the GDP does not translate into new jobs. Existing workers absorb some of the increased economic activity by working longer hours and being more productive, it says.

Models that predict the number of U.S. jobs with and without the stimulus still conclude that the bill will create or save 3.5 million by the end of 2010, the report says.

Read the rest from the Associated Press:
http://news.yahoo.com/s/ap/2009051
1/ap_on_go_ca_st_pe/us_stimulus_jobs_1

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