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SENIOR ADMINISTRATION OFFICIAL: Great, thank you, everyone. So mainly I'm going to be here to take your call -- your questions, but let me just give you a very brief overview of what this report is.
It serves several purposes. One was to sort of summarize or to reinforce what we had done originally to estimate the number of jobs that we expected the Recovery Act to save or create. It discusses how once we got into office how we've met with all of the economists and the agencies to get a sense of how they would measure or estimate job creation and worked up a system for doing that so that we get consistency across the agencies.
The other thing that we've been working on -- and this is just sort of the first description -- is the actual reporting, because a crucial part of this is now going to be, as we're actually doing the spending and we're building the roads and we're building the dams and levees, the recipients of that money need to keep track of how many jobs are actually being created, and we're reporting that back.
And so our report kind of has the overview of the basic principles of how that's going to be, what will be in sort of a broad brush description of what's going to be in the OMB guidelines.
And then the last thing that the report talks about is the particular role of the CEA, because we have a reporting requirement under the act of Congress to actually tell them how we're doing. And so this is very much kind of the first step of us sketching out how we plan to make those reports, the kind of information we'll be using, how we'll be blending the actual numbers that we get back from some of the recipients with some of the estimation that we've done to come up with what we think are the best numbers.
So anyway, that's the big picture, what's in the report. And now I'm happy to take questions.
Q: Hi there. This is Julianna Goldman with Bloomberg News. Just before the question, in terms of a housekeeping issue, I just wanted to see if there is any way to -- for this to be -- or portions to be on the record, given the fact that Senior Administration Official has been doing interviews with other outlets and that Senior Administration Official was on C-SPAN and with USA Today.
But anyway, in terms of the question, from the January 11th report, from that radio address, the report projected the unemployment rate to stay around 7 percent by the end of -- to be around 7 percent by the end of 2010, and just wanted to see how that factored into the report today, and given the numbers from last week.
MS. OXHORN: Real quick before she answers the question. I just wanted to continue to confirm that that this call is on background, and attribution is to a senior administration official. Thank you.
SENIOR ADMINISTRATION OFFICIAL: Hi, so you raise a good question about the unemployment rates. So, I think the important thing to understand -- nothing has changed about our estimates in terms of what the program is going to do. So this idea that it would save or create 3.5 million jobs, that all is the same.
Again, it's important to remember what it was relative to. What we always said was that was the number of jobs relative to the baseline in 2010, quarter four. And I think what your question is getting at is, we all know probably the baseline deteriorated between when we did our first report in January and over the first couple of months of the year; that all the private forecasters, as well, were ratcheting down their forecasts.
So we certainly keep the same -- we think the program is going to do the same thing that we always said it was going to do, but I think it is realistic to think that the baseline is less good, and so the unemployment rate is likely to result, even if we do indeed create or save 3.5 million jobs. It's almost surely going to be somewhat higher than we thought back in the January 11th report.
Q: Thank you.
Q: Does this report take into consideration any change in your economic assumptions?
SENIOR ADMINISTRATION OFFICIAL: That gets exactly to the -- the same as the previous questions. It does not -- this is all about the effects of the program. And that we very much feel is the same as ever, and it really gets into question of what the baseline was.
The important thing is, as is standard practice, we will be doing a mid-session review for the budget. And so we will be doing a new administration forecast, and that process is just now starting and it won't happen until the mid-summer. That's, as you know, a big standard administration procedure. So that will be when we will talk about how we think the baseline may have changed.
Q: Hi. I have a question on the states. They've been very concerned about the reporting requirements and there has also been questions of whether the administration would help them pay for some of the administration and getting out the jobs reports to you. What's an update on that?
SENIOR ADMINISTRATION OFFICIAL: So I think -- let's see, the first thing to say is the reporting requirements are certainly being worked out by OMB and it's in the process of comments. And so that's why my report or the CEA report was really spelling out the general principles of how they're going to be asked to respond and all of that. But the actual details will be coming out of OMB and my understanding is in the next week or two.
And then in terms of who pays for the administrative things, that's definitely a question for someone other than me. That would definitely be an OMB issue.
Q: Okay. Can I ask a follow-up?
SENIOR ADMINISTRATION OFFICIAL: Sure.
Q: Okay. Then another concern of the states is that the administration put out estimates of job creation per state and there's some concerns that -- and I take it that's your area -- there are some concerns of what the governors and the state officials will -- what account they'll be held to by their own constituents if they don't end up meeting the federal job estimates.
SENIOR ADMINISTRATION OFFICIAL: So that's an interesting question. I think one of the things the -- we have always been very clear that the jobs estimates by state were inherently more speculative than the ones for the nation as a whole -- just simply, we have a lot more information on the country as a whole and sort of the macro impact.
So I think everyone understands that, and we've tried to be very clear that these numbers, by state, are certainly -- we did the best job we could with some limited information.
But I think people are going to be reasonable, and what they're going to want to see is how are various projects doing, how do they compare across the country. And that's the kind of information that we're going to be getting from these direct reports.
Q: Thank you.
Q: Hi, thank you. So the fact that this will save 3.5 million jobs, and that's what you had expected it to do when you went into it, but you do say that the baseline is worse -- so I guess that begs the question: Do we need another stimulus? Is this pointing to the fact that we're starting to look like we need to do more in order to save more jobs and put us on the path to recovery?
SENIOR ADMINISTRATION OFFICIAL: One of the things that we've always been very clear about is that the Recovery Act was just one piece of the overall recovery plan. And so -- I love Secretary Geithner's line. He often says that there's more stimulus in financial rescue than in fiscal stimulus. The idea that the work that we do to get homeowners staying in their homes, to bring down mortgage rates, to get people refinancing, to get banks lending again -- we think all of that is also going to be incredibly important for job creation.
And so certainly getting 3.5 million jobs from the Recovery Act is what we expected to get and we think is going to be incredibly important. We're hoping very much that getting lending going again is going to also be important for job creation. We do think -- Mark Zandi has a number that our housing plan is like a $30 billion tax cut, in terms of putting money in people's pockets.
All of those should add up. That said, we're going to have to monitor this thing. The reason we'll be doing another forecast, the reason we'll be watching so much these numbers as they come in, is to make sure we're doing what we need to do to put the economy back to the track we want it to be on.
And at this point, we absolutely think that we've taken the right steps and that it is going to do what it needs to do for the American people. But the President has always said he'll do what it takes, and so we will be -- we will very much be watching.
Q: And when will you start to put that next forecast together? What's the starting time for that?
SENIOR ADMINISTRATION OFFICIAL: So one of the things I've learned since I've been here, it takes much longer than you think, so I will tell you we have the first organizational meeting tomorrow. But that certainly -- because it involves OMB, the CEA, the Treasury, it is, I have learned, a very big production. We take it very seriously.
So I think it normally comes out sometime in mid-summer. But we will work on it for many weeks.
Q: Hi, good afternoon, thank you. This is somewhat of an overlap of the first two questions. What is your timetable, as well as how are you making sure that all parts of the country, as well as those that need the jobs the most, will be addressed commensurately?
SENIOR ADMINISTRATION OFFICIAL: So I'm not sure what you mean by the timetable. We certainly -- one of the things that the Act -- one of the main issues that we had is to make sure that the money gets out the door quickly, because we do know people are hurting throughout the country, and we are continuing to lose hundreds of thousands of jobs a month.
So on that scale I can tell you we're actually doing very much what we anticipated. One of the exercises I did at the 100 days mark is to look at what we had assumed about how the money would spend out, and actually get the numbers on how we were actually doing. And we were very much right on track.
So in terms of -- it both gave me some confidence in our overall -- in the numbers that we've put out, but also giving very much the sense that we are doing what we anticipated and what I know everyone involved in this Act wanted, which is to get some money out as quickly as possible.
In terms of the geographic distribution, so much of that was determined in the formation of the Act -- that there were plans in what kind of infrastructure would be done; what were the formulas for safe fiscal relief. So most of that was determined by the Congress in the Act that we signed, but we are certainly, again, going to be monitoring every state, every county, finding out what's happening in terms of the actual reporting of where the jobs are being created and how things are going.
Q: Thank you.
Q: Good afternoon. I had a quick question on the -- can you assess the quality of jobs that are being created? Some new estimates show that among college-educated workers the unemployment rate is at about 4.4, which I believe is the highest since it's been measured. And I'm wondering if those -- if your job creation and job savings are occurring commensurate to the level of unemployment in all sectors.
SENIOR ADMINISTRATION OFFICIAL: That's an excellent question. You are absolutely right that we are seeing unemployment -- interestingly sort of throughout the spectrum, both educational, sort of we know over a variety of industries, demographic groups. So it is an incredibly broad-based recession in that sense.
In terms of the quality of jobs, that's actually I think something, in the direct reporting, one of the things that we anticipate getting back is a little more freeform but some description of what the jobs were so that we -- it's not something we have a good handle on right now but it is something very much we're hoping to get information on, because that is important to know what the nature of the jobs are that were being created.
Something that may be useful to put out here -- if you think about it, as I mentioned, one of the things that the Council of Economic Advisers is going to have to do is report to Congress. And if you think about the direct reporting, where we have government spending to build a road, there you can actually imagine getting numbers back on this many people were hired and that. But if you think about the tax cuts, that's a piece that we absolutely think is going to be creating jobs, but there's not going to be anyone that can write down the names of who got those jobs.
And so there's inherently going to be an important estimation part of this to try to figure out, looking do we see consumer spending, what do we think that did and all of that. What brought that to mind is something like your question -- we naturally tend to think if we're spending money on infrastructure that mainly goes into construction, maybe into manufacturing. But if you think about the tax cuts, that's something that we'd expect to go really kind of throughout the economy; that people will just buy more of all the things that they were buying before. And that would affect the college-educated, the doctors, the lawyers, but then right on down to the retail workers and the waitresses at the restaurant.
So that's how I think those parts of the program really sort of get to jobs throughout the whole economy. And that was always one of the pieces of logic to the whole program, is to have a balanced program, a mixture of tax cuts, spending, relief to the states, precisely to make sure we weren't getting all our job creation just in one area or just in one kind of worker, but to have it spread throughout the economy.
Q: Thank you. And if I might just add, I'd like to second Julianna's request that these be on the record. I understand that this has already been arranged, but just a "big D" version of this.
Q: Thanks for taking the questions. A lot of this report is based off estimates about what the multipliers of GDP from government spending and from tax cuts, what those multipliers are. When you do the reevaluations, are you going to be retesting whether or not those assumptions about the multipliers were reasonable? Will that be part of the --
SENIOR ADMINISTRATION OFFICIAL: That would certainly be one of the things that we'll be looking at. The other thing we'll definitely be checking are the spend-out assumptions, because certainly our estimates have been based on what we -- how we thought the program was going to spend out. That's something we'll need to check.
The other thing that's going to be so nice about getting the direct reporting, right, so we can try to say, here's what we thought we were going to get, and when we get the numbers back, how do they compare? It will inherently be at -- you know, it'll be a two-way test. There are issues involved in how good the numbers we get back are going to be, and it will also be a test of what we were assuming about multipliers. And so, absolutely.
One of the things that I try to emphasize in the reports -- because we haven't yet even had to face a report to Congress -- is, we're going to do it lots of ways but I think -- to make sure that we've covered all our bases, we're going to try estimating it one way, we'll look at the direct numbers, we'll try some different multipliers, we'll be looking at other studies, we'll be doing some microeconomic analysis to see if, you know, a county had a whole lot of government spending; does it show up in the county employment data? We're just planning to very much go on all fronts to get as complete a picture of what this Act is doing as we possibly can.
Q: And will that include an estimate of sort of the lost opportunity costs of servicing the volume of Treasury debt we're issuing?
SENIOR ADMINISTRATION OFFICIAL: To the degree that that's an issue, I think it inherently shows up in the multipliers. So multipliers are estimated over past history. So to the degree that in past history when you do an increase in government spending, it goes with higher debt. That is part of what shows up in that sort of reduced-form estimate of what -- the oomph to the economy.
So I think certainly we can be thinking about whether there's something special this time, and that's what one always does when you're using a historical number. But for the most part it should be there in the bottom-line numbers.
Q: Thank you.
Q: Thank you. My question is specifically related to energy jobs. And I'm wondering if you could talk a little bit about that, the green jobs that might be created -- would those be ephemeral two-year positions? Could you just talk a little bit about that?
SENIOR ADMINISTRATION OFFICIAL: I can. Certainly in what we're doing, we're more on the overall jobs numbers rather than the sectoral composition, and certainly green versus non-green or whatever. I think the important thing -- I mean, what we know is that in the Recovery Act, we did have a lot of money for weatherization for jumpstarting renewable energy and all of that. We think that's going to be important for creating jobs right now.
But certainly if you've looked at our budget, you know that that is a continuing priority of the President. And so we very much think of the Recovery Act as the down payment on his overall energy agenda. And so you know if you've listened to the President talk that green jobs and that the future of energy in the United States is a very big priority for him.
So I would certainly expect those jobs to continue, because it's got to be the direction that the country moves -- that we need to get more energy independence. We know that climate change is an issue, and our future is going to be in non-fossil fuels. And so those are -- and certainly in energy conservation. And so those are certainly going to be important jobs not just now but going down the line.
Q: But would energy jobs be a large portion of the 3.5 million that you talk about in the report?
SENIOR ADMINISTRATION OFFICIAL: Well, I'd have to look. Certainly back in our original report I think we may have done some of terms of thinking about certainly what the energy piece -- or at least probably energy was mixed in with some others. To a large degree it will be roughly proportional to the spending that went into energy. And I don't have the numbers offhand, but certainly they were a pretty big chunk of the government spending. But certainly they were one. And we did health care. We did education. There's a lot of infrastructure.
So I think that's the right way to think about them. They're a piece -- an important piece, but certainly not the overwhelming majority or anything like that.
Q: Okay, thank you.
Q: Thank you. Can you provide a breakdown of the number of jobs created versus those saved? And does a job that's created have the same impact, or more of an impact, on the economy than a job that is saved?
SENIOR ADMINISTRATION OFFICIAL: You inherently -- your question is a good one. I think when you think about what the exercise is, what you realize is that saved or created is a shorthand way of saying, "relative to the baseline." Very much the way we are thinking -- the way anyone who wants to estimate what the policies do, you say sort of what's the direct effect of the policy?
And that's a number that you can get a good handle on. What none of us has is a crystal ball to know where the economy was going without the policy. And so very much the way we always described that 3.5 million is, in 2010, quarter four, wherever we were going to be, we felt that we were going to be 3.5 million jobs bigger than that because of the stimulus package.
And so that's why it -- the kind of a saved versus created, at least for an economist, is not really a well-posed question in the sense that we're always talking about where are we relative to the baseline. And I think that is still the crucial idea.
The important thing to say is, whether they're created or saved, those are 3.5 million people that will have a job that would not otherwise have had them. So in terms of the impact on people, on the economy, at some level they're exactly the same. That is jobs that are there that wouldn't be there without the program.
Q: Are the jobs the same quality in terms of the impact on the economy? I mean, does a job that's created have a greater multiplier than a job that's saved?
SENIOR ADMINISTRATION OFFICIAL: It's a first approximation, they're the same. They are -- it's a person who's working and spending that otherwise wouldn't be able to do that. And so in terms of their effect on the overall economy, I'd anticipate that they would be largely the same.
Q: Thank you.
Q: Hi. I had a question about a figure that President Obama mentioned in his April 29th speech. He had said there about the 150,000 jobs saved or created. The report seems to talk about all these much bigger numbers and I was wondering, if on that figure in particular, if you had sort of any -- my understanding is it's also an estimate, but if you have any details on sort of the regions in which these jobs have been saved or created, or the sectors specifically for that figure?
SENIOR ADMINISTRATION OFFICIAL: So since I'm the source of the 150,000, I'll tell you what I --
Q: Oh, great.
SENIOR ADMINISTRATION OFFICIAL: So, very much -- I mean, the numbers that you all have in the report are of course -- are either as of the fourth quarter of 2009, 2010, whatever, or average for the year. And one of the things that we absolutely know is that the program is ramping up quickly, but certainly in the first hundred days we'd only had about, what, 72 days since the fiscal stimulus was passed. So there's a -- how much money was actually out the door. And then the other thing is just there, we think, naturally lags in terms of how quickly people get employed, how quickly the tax cuts start to affect spending, and all of that.
So, you know, our number was certainly -- probably a conservative estimate of what we thought the plan had done in this very, very short time frame. What I can tell you is we were anticipating it going up quickly, so I think we got a number like 750,000 by the end of the second hundred days. And so what we definitely anticipate is this thing is just now starting to really hit the economy.
In terms of exactly where and in what sectors, that's not something I have numbers on because precisely we don't yet have any of the reporting. And so knowing -- I'm sure each of the agencies can tell us which states are getting this particular grant, but I don't actually have numbers on how it's adding up, say, across states, or something like that, at this point. But certainly it will be something we will have, going forward.
Q: Thank you.
Q: You may have answered this with some of your earlier remarks, but I wanted to ask in the report you'll put out in mid-summer, do you expect to break down how many of the jobs would be so-called green-collar jobs, versus other --
SENIOR ADMINISTRATION OFFICIAL: It's certainly an issue that there is a lot of interest in. And certainly I know there are people at OMB, there are people in, say, the -- some of the Council for Environmental Quality. So there's certainly a lot of interest in here, and it's something that we are just sort of trying to just now get a handle on. I'm sure, if you've been following this, you know how you -- what classifies as a green job and all of that, and certainly -- it's certainly very difficult.
So I think I'm going to just say, let me think about that one. And certainly I know it's going to be an issue that somewhere within the administration we'll be trying to put out a number. Whether it will come out of the CEA or some other agency, I think that's yet to be determined.
Q: Hi, forgive me if I did not understand your answer before, but beside the geographic distribution, how are you ensuring that sufficient jobs will be created in the areas of concentration where jobs are needed the most, whether it's geographic or the particular job sector?
SENIOR ADMINISTRATION OFFICIAL: The answer that I gave before was to say at some level where we're doing the spending and what kind of things we're doing was determined by Congress, in terms of what -- there was money for weatherization, there was money for infrastructure, those kind of things.
What you may be getting at is even a broader question of, we do know, for example, with what's going on in the auto industry, a lot of concern about unemployment and certainly in communities in Michigan and things like that.
So certainly there's very much a sort of -- I kind of separate it from the Recovery Act of another sort of watching sort of what's going on. There's been a lot of interest in marshaling any training funds that we have, the training assistance funds, to help, say, particular communities that are hurt -- that very much is an issue that we are looking at. I just think it's somewhat outside the narrow purview of the Recovery Act. It's a much broader thing. I know the Department of Labor -- Ed Montgomery has been appointed as their sort of -- working certainly with the auto community. But it is going to be an issue going forward of making sure that the people that are being hurt are being helped.
I will say one of the things that was so important in the Recovery Act is the added benefits for unemployed workers, the programs that provide the continuing health care coverage for workers that lose their jobs, certainly the subsidies through the Recovery Act. All of that we think is crucially important to certainly at least minimizing the harm to the people that are losing their jobs. So that's been an important component.
Q: Just to follow up on that -- thank you -- that is what I was getting at, both the auto industry, the financial sector, and all the collateral damage, so to speak, of all the -- the ripple effect, jobs that are then lost. That's what I was asking, because those then are not necessarily geographically concentrated, but they are focused within a particular job sector.
SENIOR ADMINISTRATION OFFICIAL: Absolutely.
MS. OXHORN: Thank you very much, everybody, for joining.
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