More questions over stimulus jobs

New government report raises concerns about the accuracy of the Obama administration's tally that 640,000 stimulus jobs have been created or saved.

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By Tami Luhby, CNNMoney.com senior writer

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NEW YORK (CNNMoney.com) -- So just how many jobs has the $787 billion stimulus package created or saved?

A new government report raises a new round of questions on the Obama administration's figure of 640,000 jobs, saying there are many concerns surrounding the data recipients reported.

"There is a range of significant reporting and quality issues that need to be addressed," said Gene Dodaro, acting comptroller general, in a Government Accountability Office report released Thursday.

Dodaro testified Thursday before a House panel examining the tracking of stimulus dollars.

The American Recovery and Reinvestment Act calls for funding recipients to report quarterly the number of jobs they created or saved. Though federal agencies review the submissions, the burden to correctly calculate the positions rests largely on the recipients. The reports are posted at the Recovery.gov Web site.

The GAO review found many questionable or erroneous data entries that it said merit further attention. Also, some 10% of recipients did not submit reports and less than 1% of primary recipients reviewed their submissions. And, recipients interpreted the administration's instructions on how to count jobs differently.

The agency recommended the administration clarify how recipients are to report stimulus job creation and re-examine the reporting process. The next set of reports are due in January.

In response, Earl Devaney, who chairs the Recovery Board, which is responsible for Recovery.gov, testified that mistakes in the data were due to the first-of-its-kind system of recipient reporting, and he is confident that mistakes will be found and corrected.

"These mistakes do not surprise me ... and they are not unequivocally bad," Devaney told the House Thursday. "In reality, this data should serve in the long run as evidence of what transparency could achieve."

In the meantime, Devaney said the 640,000 jobs that recipients reported they saved or created "may not be the correct number."

Is stimulus working?

The number of jobs created or saved by the largest stimulus program in the nation's history has become a hot button topic in Washington, D.C.

The administration last month released the first tally of job reports from state and local recipients, as well as private companies. Officials maintain that the program is on track to create or save 3.5 million jobs by the end of next year and credit it with turning around the economy.

Republicans, however, are using the rising unemployment rate, which hit a 26-year high of 10.2% in October, to assert that the recovery act is a waste of money.

"The administration continues to rely on a discredited economic theory that puts a misplaced faith in government spending on pet projects," Rep. Darrell Issa, R-Calif., said Thursday in his opening statement.

Administration officials acknowledge that the stimulus tracking reports contained errors, though they estimate the mistakes amount to only 5% of the data reported. They say they are working to improve the guidance to recipients on how to count jobs so the results are more uniform. And they will continue examining the data for mistakes and inconsistencies.

"We are committed to continually improving the reporting process so that the goals of the [recovery] act in terms of transparency and usefulness to the American people will be met," wrote Danny Werfel, controller, Office of Management and Budget, to Dodaro in response to the report.

Still, agency officials and administration supporters testified Thursday that the stimulus act is helping the economy, according to copies of their testimony obtained from an administration official.

"There's no question the Recovery Act is working as intended, putting Americans to work while making long-term investments in our infrastructure," said Deputy Transportation Secretary John Porcari.

Recipients of transportation department funds have created or saved 45,250 jobs, according to Porcari.

Though the unemployment rate is rising, the pace of job losses has slowed, John Irons, research and policy director at the Economic Policy Institute, will tell lawmakers. Some 691,000 jobs were lost per month, on average, at the begriming of 2009. That figure dropped to 188,000 for the most recent three-month period.

Also, the gross domestic product rose by 3.5% in the most recent quarter, after experiencing the most rapid decline since 1947 for the nine-month period ending in March.

"The economic evidence clearly shows that the Recovery Act is having an impact," according to Irons. To top of page

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