The White House has quietly changed its method of counting jobs tied to federal stimulus spending following intense criticism of the practice.
And that change will make it impossible to determine the total number of jobs created or saved through President Barack Obama’s $787 billion spending program.
Here’s why: The federal Office of Management and Budget previously told recipients of the stimulus dollars to count only jobs that were created and filled as a result of stimulus spending or existing jobs “that would not have been continued” if not for the spending.
Now all jobs funded with stimulus dollars will be counted as created or saved, whether or not they were in jeopardy of being eliminated, according to new rules OMB released last month in a memo that drew little attention. Also, when stimulus money is used for pay raises, it will translate into a fraction of a job created or saved. OMB officials say the changes should take the guesswork and confusion out of the reporting process.
Also new, recipients of the taxpayer dollars will report total jobs on a quarterly basis, not cumulatively. As a result, federal officials say they will no longer keep a running tally of created and saved jobs on their Web site recovery.gov. Instead, what the public will see on the Web site will be a three-month snapshot of full-time equivalent positions tied to the spending, based on hours worked during that quarter.
News media organizations – including The Atlanta Journal-Constitution – had exposed numerous errors in the job counts in recovery.gov last year. Some stimulus recipients have overstated jobs tied to the spending, while others have underreported jobs.
The AJC, for example, reported on Nov. 15 that several organizations that offer Head Start preschool programs and other services in Georgia reported retaining hundreds of jobs based on raises they gave their employees.
Seizing on the news media reports, Republicans blasted the Obama administration’s handling of the spending program. The Government Accountability Office released a report in November, urging the White House to simplify its counting methods.
OMB officials said they changed their counting rules in response to Congress, the GAO and others.
“We listened to a variety of voices,” OMB spokesman Tom Gavin said. “We took all of the concerns and constructive criticism to heart and have tried to adopt a system that is more effective and more efficient.”
Rep. Darrell Issa, the ranking Republican on the Oversight and Government Reform Committee, said the changes could inflate the government’s jobs counts. The California congressman has asked the government to put a disclaimer on recovery.gov that says the next quarterly count will be based on a “much more generous definition” of created or retained jobs.
“It is troubling that the administration is changing the rules and further inflating the Recovery Act's impact and masking the failure of the stimulus to produce sustainable economic growth or real job creation,” Issa wrote in a Jan. 8 letter to Earl Devaney, chairman of the Recovery Accountability and Transparency Board, which operates recovery.gov.
Devaney responded Wednesday in a letter to Issa that it is “considerably easier” to audit jobs funded rather than jobs saved or created. He said the Web site will note how the estimates were calculated in both reporting periods.
Gavin, the OMB spokesman, denied the changes are intended to inflate job counts.
“We don’t know at this point what the impact is going to be until we move through it, but we have seen… some downward pressures on job counts,” Gavin said. “I think it is an unfair criticism and perhaps an unfounded one to suggest this is just a select maneuver by the White House to try and pad its numbers.”
A government watchdog suggested counting hours worked on stimulus projects would be a better approach.
“Let the public get at as granular data as possible to make our own discussion,” said Craig Jennings, director of federal fiscal policy for the Washington-based OMB Watch, a government watchdog group that is part of the Coalition for an Accountable Recovery.
Signed by Obama on Feb. 17, the American Recovery and Reinvestment Act requires recipients of stimulus funds to file quarterly reports to the government, showing how they are spending the money and how many jobs are tied to that spending. Those reports were never intended to show by themselves whether the program has met Obama’s goal of creating or saving 3.5 million jobs because they represent only a fraction of the spending, Gavin said. The Recovery Act also includes tax cuts and other federal aid not captured in the reports.
Meanwhile, the quarterly stimulus reports covering Oct. 1 through Dec. 31 are due this month. Georgia officials are preparing to release a summary of their stimulus spending and job totals early next week. They said OMB’s new rules are an improvement.
“It’s easier to follow. It is not as confusing,” said Greg Griffin, Georgia’s state accounting officer, who is helping compile Georgia’s reports. “And folks only need to worry about one quarter at a time and not figure out how to add things up from quarter to quarter to quarter.”
The Recovery Act also requires the White House Council of Economic Advisers to file quarterly reports on the impact of the program. In a Jan. 13 report, the council estimated the spending has boosted employment by 1.5 million to 2 million jobs so far.
Results
The Atlanta Journal-Constitution is among numerous news media organizations that exposed errors in the federal stimulus program’s job counts last year. Republicans cited some of those errors in hammering the Obama administration’s handling of the $787 billion spending program. The Government Accountability Office released a report in November, urging the White House to simplify the process. The government said it listened to Congress, the GAO and others and is now requiring several changes in the way agencies count jobs tied to stimulus spending.
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