White House: Stimulus Created or Saved 3.2 Million Jobs

This morning, the White House released an updated report on the impact of the American Recovery and Reinvestment Act, the stimulus bill passed in February 2009. The headline numbers are that the stimulus saved 3.2 million jobs by the end of last quarter and will save a further 500,000 through the end of the year:

The report is broadly in line with previous estimates about the impact of the stimulus. Other banner statistics include:

• The stimulus changed the economic trajectory. “Real GDP began to grow steadily starting in the third quarter of 2009 and private payroll employment has increased by nearly 600,000 since its low point in December 2009.”
• The stimulus “raised the level of GDP as of the second quarter of 2010, relative to what it otherwise would have been, by between 2.7 and 3.2 percent.”
• For every dollar of stimulus funds for state and local government spending, the private sector is spending $3.
• The report also shows that certain funds will come into fuller effect in the next year. For instance, “[Of] $319 billion of public investment spending…two-thirds of these appropriated funds have been obligated and more than one-quarter have been outlayed,” meaning three-quarters remain to be spent.

That said, a recent report presented to Congress by Mark Zandi, chief economist of Moody’s Economy.com, via The Economist, makes the case that the stimulus is basically done stimulating the economy, auguring doldrums ahead. Here it shows that stimulus will stop lifting GDP:

And here it is a chart of state and local government budget gaps, closing but still prevalent, meaning continuing job losses and service cuts: