White House Highlights Green Jobs From The Recovery Act
A report delivered by the Council of Economic Advisers today found that the clean energy investments of the American Recovery and Reinvestment Act (ARRA)are not only creating jobs today, but for the future.
The clean energy provisions of ARRA alone have already saved or created 63,000 jobs and are expected to create more than 700,000 by 2012. When we talk about clean energy jobs, we mean new work for skilled laborers who can install efficient heating and cooling systems and windows, who can retrofit homes to save electricity, who can build and install solar panels, wind turbines and other clean energy technologies.
These investments are positioning the American workforce to remain competitive and keep our nation at the forefront of a new low-carbon global economy. At the same time, these initiatives are changing the way that we produce, distribute, and use energy to reduce green house gas emissions and cut our dependence on foreign oil.
As we have seen across the portfolio of Recovery Act clean energy programs, demand is in some cases exceeding expectations with programs receiving far more qualified applicants than there is currently funding available.
That is why, as part of the jobs package on which the President is urging Congress to act, he has called for additional clean energy investments – including home weatherization and advanced energy manufacturing tax credits – which could put even more Americans to work right away.
The global competition to develop the technologies of a clean energy economy is happening right now. We do not want to lose that competition and see the technology and jobs of tomorrow built overseas. The Recovery Act investments are a good start, stimulating the American innovation and investments necessary to be the leader of a new energy future, but ultimately, to ensure the U.S. leads the world in the production of clean energy and to induce the necessary private investment, we must also pass comprehensive energy reform. This will help unlock the true potential of the millions of jobs needed for the clean energy economy of tomorrow.
As part of the unprecedented accountability and transparency provisions included in the American Recovery and Reinvestment Act of 2009 (ARRA), the Council of Economic Advisers (CEA) was charged with providing to Congress quarterly reports on the effects of the Recovery Act on overall economic activity, and on employment in particular. In this second report, we provide an assessment of the effects of the Act through the fourth quarter of 2009.
Evaluating the impact of countercyclical macroeconomic policy is inherently difficult because we do not observe what would have happened to the economy in the absence of policy. And the sooner the evaluation is done, the less data one has about key economic indicators. Any estimates of the impact of the ARRA must therefore be regarded as preliminary and understood to be subject to considerable uncertainty. Because of the inherent difficulties in the analysis, we approach the task of estimating the impact of the Recovery Act from a number of different directions, and supplement our estimates with those of numerous outside analysts.
Among the key findings of the study are:
- As of the end of December 2009, $263.3 billion of the original $787 billion, or roughly one-third of the total, has been outlayed or gone to American households and businesses in the form of tax reductions. An additional $149.7 billion has been obligated for projects and activities, which means that the money is available to recipients once they make expenditures.
- Following implementation of the ARRA, the trajectory of the economy changed materially toward moderating output decline and job loss. Indeed, real GDP began rising in the third quarter of 2009, and job losses in the fourth quarter were one-tenth their size in the first quarter. The decomposition of the GDP and employment change by component or sector suggests that the ARRA has played a key role in this change of trajectory.
- The two CEA methods of estimating the impact of the fiscal stimulus suggest that the ARRA added between 2 and 3 percentage points to real GDP growth in the second quarter of 2009; between 3 and 4 percentage points in the third quarter; and between 1½ and 3 percentage points in the fourth quarter. These estimates are broadly similar to those of a wide range of other analysts.
- The CEA estimates that as of the fourth quarter of 2009, the ARRA has raised employment relative to what it otherwise would have been by 1½ to 2 million.
- For the third quarter of 2009, we now have direct reports on jobs created or saved from a subset of recipients of ARRA funds. These reports identify 640,000 jobs that would not have existed but for the Recovery Act. Our review of this additional data source shows that the recipient reporting estimate is broadly consistent with more comprehensive estimates for the third quarter, once one takes into account the limited scope of the recipient reports.
- A special section of the report focuses on the clean energy provisions of the ARRA. Our analysis shows that roughly $90 billion of the total budget impact of the Recovery Act falls into this category. Of this total amount, roughly $5 billion has been outlayed (or received as tax cuts), and another $26 billion has been obligated as of the end of December. We estimate that these components of the ARRA have directly saved or created approximately 52,000 clean energy jobs as of the fourth quarter of 2009, and supported another 11,000 jobs of all types throughout the economy.
NOTE: In case you missed it, this week Carol Browner, Assistant to the President for Energy and Climate Change, held a live chat. Also, get some additional perspectives on the President’s record on clean energy and climate change from the Center for American Progress and the Natural Resources Defense Council.
Heather Zichal is Deputy Assistant to the President for Energy and Climate Change
Topics: Advanced Energy Manufacturing Tax Credits, American Recovery and Reinvestment Act, ARRA, clean energy investments, clean energy jobs, clean energy technologies, climate change, Congress, cooling systems, economic development, economic growth, Economy, electricity, employment, energy, energy reform, foreign oil, funding, global competition, Governance, government, green house gas emissions, Green Jobs, heating systems, home weatherization, low carbon global economy, overseas, President Obama, private investment, recovery act, renewable energy, skilled labor, solar energy, solar panels, tecnology, White House, wind energy, workforce
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