Following is a White House blog posted today seeking to clarify what it sees as a "misleading" Associated Press report on how many jobs have been saved or created by the government's stimulus plan. Following that is the AP story that started the whole thing.

 

The White House Blog

Reality Check: AP Story Misleads on Recovery Act Job Reporting

Posted by Ed DeSeve on October 29, 2009 at 12:22 PM EDT

 

You may have seen a misleading Associated Press story this morning on the accuracy of Recovery Act job reports that were posted earlier this month on Recovery.gov. On the same day that we learned that the economy has begun to grow again for the first time in over year, the very critics who opposed economic rescue from the beginning are now trying use this misleading story to twist the truth about the early success of the Recovery Act.

 

Here is what you should know:

 

Governors, mayors, county executives, private businesses and community organizations across the country submit reports to Recovery.gov so that you can get an unprecedented look at how your taxpayer dollars are being spent creating jobs and boosting the economy through the Recovery Act. These reports are not from the federal government - but from the very people putting Recovery funds to work.

 

Our top priority is ensuring that, when the reports are posted on Recovery.gov tomorrow, you will get the most accurate look possible at what has taken place with the Recovery Act over the last eight months. That’s why we have been working with the Recovery Accountability and Transparency Board - an independent oversight body - and the actual people that submitted the reports to conduct an extensive three-week review of them.

 

Three business days into the review, the Board posted a preliminary portion of those reports - just federal contracts which represent less than 2 percent of the Recovery Act and are a sliver of the information collected - on Recovery.gov so that you could get a look at what had been turned in initially. We support the Board’s act of transparency - but were clear that day that we considered the reports "partial and preliminary" and noted that it was "too soon to draw any global conclusions" from them.

 

Our twenty-day review wraps up today and we can say with confidence that the full set of reports going up tomorrow - corrected versions of the reports posted on October 15th, and many more new reports being posted for the first time now -- are far sharper than the initial ones you saw two weeks ago. In fact, our review process had already caught four out of five items that AP's misleading story cites as “over-counting” jobs. With every review of the reports, with every call to the person filing them to confirm them, the information has gotten better and better - and we are looking forward to their public posting tomorrow. It will be a historic moment for government transparency.

 

Here are the real facts on AP's misleading story:

 

“The government has overstated by thousands the number of jobs it has created or saved with federal contracts under the president’s $787 billion recovery program, according to an Associated Press review of data released in the program’s first progress report.”

 

FACT: The reports are not from the government, but from the very people putting Recovery Act funds to work - governors, mayors, county executives, private businesses and community organizations across the country. We take our responsibly of reviewing these reports for accuracy very seriously - that’s why we are putting them through an extensive three-week review process that ends today. And the initial preliminary set of data representing just a sliver of the overall reports was not posted by the government - but by an independent oversight body overseeing our Recovery Act efforts.

 

“The errors could be magnified Friday when a much larger round of reports is released.”

 

FACT: The federal contract data AP reviewed was a test run posting of a small sub-set of the data that was made available to the public after less than three business days of review time. The full data that will be posted on Friday will have undergone an extensive review process for twenty days involving the Recovery Board, federal agencies and direct communication with the recipients themselves. So the data posted this Friday will be more accurate - not less - than what was posted on October 15th.

 

FACT: The federal contract data AP surveyed represents just 2 percent of overall Recovery Act spending and just a fraction of what will be posted on Recovery.gov on Friday. It does not provide a statistically significant indication of the quality of the full reporting that will come on Friday. 

 

"A Colorado company said it created 4,231 jobs with the help of President Barack Obama's economic recovery plan. The real number: fewer than 1,000."

 

FACT: The very first example AP cites was already corrected more than a week ago as part of the twenty-day review process and the change is in the final data posting being prepared for Friday. This item represents over 3,000 - or 60 percent - of the “nearly 5,000 jobs” AP uses to try to make its argument.

 

FACT: The company in question actually did hire more than 4,000 workers - but because the work was not full time, full year work, the rigorous standards at Recovery.gov don’t count it as 4,000 workers. AP is wrong in saying that 4,000 workers is not a “real” number: 4,000 people got paychecks and got work thanks to the Recovery Act. The posting was erroneous because our higher standards only count the equivalent of full-time, full-year jobs as jobs “created or saved.”

 

FACT: All recipients were given through October 30th to clarify and confirm their data - including those linked to federal contracts. Any conclusions drawn about the quality of that small portion of data as it was posted two weeks ago are simply premature.

 

"Officials at East Central Technical College in Douglas, Ga., said they now know they shouldn't have claimed 280 stimulus jobs linked to more than $200,000 to buy three semi-trucks and trailers for commercial driving instruction, and a modular classroom and bathroom for a health education program."

 

FACT: This item - which represents less than .06 percent of the total jobs reported was also already corrected more than a week ago as part of the twenty-day review process and the change is in the final data posting being prepared for Friday.

 

FACT: All recipients were given through October 30th to clarify and confirm their data - including those linked to federal contracts. Any conclusions drawn about the quality of that small portion of data as it was posted two weeks ago are simply premature.

 

"The San Joaquin, Calif., Regional Rail Commission reported creating or saving 125 jobs as part of a stimulus project to lay railroad track. Because the project drew from two pools of money, the commission reported that figure twice, bringing the total to 250."

 

FACT: This item - which represents less than .04 percent of the total jobs reported - was also already corrected as part of the twenty-day review process and the change is in the final data posting being prepared for Friday.

 

FACT: All recipients were given through October 30th to clarify and confirm their data - including those linked to federal contracts. Any conclusions drawn about the quality of that small portion of data as it was posted two weeks ago are simply premature.

 

"The Toledo, Ohio-based Koring Group also received two FCC contracts to help people make the switch to digital television. The company reported hiring 26 people for each of the two contracts, bringing its total jobs to 54 on the government's official count. But the company cited the same 26 workers for both contracts, meaning the same jobs were counted twice. The job count was further inflated because each job lasted only about two months, so each worker should have counted as one-sixth of a full-time job."

 

FACT: This item - which represents less than .01 percent of the total jobs reported - was also already corrected as part of the twenty-day review process and the change is in the final data posting being prepared for Friday.

 

FACT: All recipients were given through October 30th to clarify and confirm their data - including those linked to federal contracts. Any conclusions drawn about the quality of that small portion of data as it was posted two weeks ago are simply premature.

 

"While the thousands of overstated jobs represent a tiny sliver of the overall economy, they represent a significant percentage of the initial employment count credited to the stimulus program."

 

FACT: The overestimate of “thousands” of jobs AP cites is out of hundreds of thousands of jobs that will be reported overall on Friday - the vast majority of which underwent the more extensive twenty-day vetting process.

 

FACT: Even if you remove the “nearly 5,000 jobs” from the total federal contracts job number, it is still in-line with government and private forecaster’s estimates of about one million Recovery Act jobs overall to-date.

 

Ed DeSeve is Coordinator of Recovery Implementation

 

ASSOCIATED PRESS STORY:

 

AP IMPACT: Stimulus jobs overstated by thousands

 

By BRETT J. BLACKLEDGE and MATT APUZZO

 

WASHINGTON (AP) - A Colorado company said it created 4,231 jobs with the help of President Barack Obama's economic recovery plan. The real number: fewer than 1,000.

A child care center in Florida said it saved 129 jobs with the help of stimulus money. Instead, it gave pay raises to its existing employees.

Elsewhere in the U.S., some jobs credited to the stimulus program were counted two, three, four or even more times.

The government has overstated by thousands the number of jobs it has created or saved with federal contracts under the president's $787 billion recovery program, according to an Associated Press review of data released in the program's first progress report.

The discrepancy raises questions about the reliability of a key benchmark the administration uses to gauge the success of the stimulus. The errors could be magnified Friday when a much larger round of reports is released. It is expected to show hundreds of thousands of jobs repairing public housing, building schools, repaving highways and keeping teachers on local payrolls.

The White House seized on an initial report from a government oversight board weeks ago that claimed federal contracts awarded to businesses under the recovery plan already had helped pay for more than 30,000 jobs. The administration said the number was evidence that the stimulus program had exceeded early expectations toward reaching the president's promise of creating or saving 3.5 million jobs by the end of next year.

But the 30,000 figure is overstated by thousands - at the very least by nearly 5,000, or one in six, based on AP's limited review of some of the contracts - because some federal agencies and recipients of the money provided incorrect job counts. The review found some counts were more than 10 times as high as the actual number of jobs; some jobs were credited to stimulus spending when, in fact, none were produced.

The White House says it is aware there are problems. In an interview, Ed DeSeve, an Obama adviser helping to oversee the stimulus program, said agencies have been working with businesses that received the money to correct mistakes. Other errors discovered by the public also will be corrected, he said.

"If there's an error that was made, let's get it fixed," DeSeve said.

Within minutes of the publication of AP's story, the White House released a statement that it said was the "real facts" about how jobs were counted in the stimulus data distributed two weeks ago. It said that had been a test run of a small subset of data that had been subjected only to three days of reviews, that it had already corrected "virtually all" the mistakes identified by the AP and that the discovery of mistakes "does not provide a statistically significant indication of the quality of the full reporting that will come on Friday."

The data partially reviewed by the AP for errors included all the data presently available, representing all known federal contracts awarded to businesses under the stimulus program. The figures being released Friday include different categories of stimulus spending by state governments, housing authorities, nonprofit groups and other organizations.

As of early Thursday, on its recovery.org Web site, the government was still citing 30,383 as the actual number of jobs linked so far to stimulus spending, despite the mistakes the White House has now acknowledged and said were being corrected.

There's no evidence the White House sought to inflate job numbers in the report, but the administration embraced the flawed figures the moment they were released.

The figures released earlier this month claimed jobs linked to roughly $16 billion in federal contracts, an initial report on a small fraction of the total stimulus program. DeSeve said federal officials had only a few days to go through the data for errors before they were made public.

It's not clear just how far off the 30,000 claim was. The AP's review, which was not an exhaustive accounting of all 9,000 contracts reported by the government so far, homed in on the most obvious cases of jobs wrongly tied to the stimulus because of duplications or misinterpretations of how the jobs should be counted.

While the thousands of overstated jobs represent a tiny sliver of the overall economy, they represent a significant percentage of the initial employment count credited to the stimulus program.

Administration officials say they are trying to head off such problems before the new figures are released Friday.

"Part of this is, it's an unprecedented effort," said Tom Gavin, a spokesman for the White House budget office. "It's as new to recipients who have to do it as it is to the American people who are able to view this data for the first time."

Some businesses actually undercounted jobs funded with stimulus money, the AP's review shows, because they reported only new jobs created, not existing jobs saved. But by far the most reporting errors were found in the number of jobs credited to the stimulus.

"I'm not trying to say one balances out the other," DeSeve said. "We don't like either of them."

In one major miscount found by the AP review, Colorado-based Teletech Government Solutions had worked with the Federal Communications Commission to come up with a job count for its $28.3 million contract for call centers fielding consumer questions about conversion of televisions to receive digital signals. The company reported creating 4,231 jobs - the highest number listed in the first stimulus accounting - even though 3,000 of those workers received a paycheck for five weeks or less.

"We all felt it was an appropriate way to represent the data at the time," company president Mariano Tan said.

Now the job count is being adjusted to less than 1,000, Tan said, to meet the requirement that a job reported is equal to a full-time, 40-hour-a-week position held for one year.

The Toledo, Ohio-based Koring Group also received two FCC contracts to help people make the switch to digital television. The company reported hiring 26 people for each of the two contracts, bringing its total jobs to 54 on the government's official count.

But the company cited the same 26 workers for both contracts, meaning the same jobs were counted twice. The job count was further inflated because each job lasted only about two months, so each worker should have counted as one-sixth of a full-time job.

The FCC spotted the problem and called company owner Steve Holland, who now says the actual job count is closer to five, not 54.

"We're just trying to be accurate. All of this has happened so fast," Holland said. "It is a little confusing. We're new to government contracting."

The AP's review identified nearly 600 contracts claiming stimulus money for more than 2,700 jobs that appear to have similar duplicated counts.

DeSeve said he's pleased that the FCC and other agencies are working with businesses to fix the errors.

Barbara Moore, executive director of the Child Care Association of Brevard County in Cocoa, Fla., reported that the $98,669 she received in stimulus money saved 129 jobs at her center, though the cash was used to give her 129 employees a 3.9 percent cost-of-living raise. She said she needed to boost their salaries because some workers had left for better paying jobs.

"They were leaving because we had not been able to give them a raise in four years," Moore said.

Officials at East Central Technical College in Douglas, Ga., said they now know they shouldn't have claimed 280 stimulus jobs linked to more than $200,000 to buy three semi-trucks and trailers for commercial driving instruction, and a modular classroom and bathroom for a health education program.

"It was an error on someone's part," said Mike Light, spokesman for the Technical College System of Georgia.

The number of jobs should be zero, Light said. The 280 count represents the number of students who would benefit, he said.

The San Joaquin, Calif., Regional Rail Commission reported creating or saving 125 jobs as part of a stimulus project to lay railroad track. Because the project drew from two pools of money, the commission reported that figure twice, bringing the total to 250.

Spokesman Thomas Reeves said the commission corrected the data Tuesday and changed the total to 73, although the count is not corrected in the government's official job tally. He said officials incorrectly added some indirect job creation to reach its initial 125 total. He said the number should not have been doubled.

DeSeve said he's confident the job counts in the first report will be corrected and future reports will have fewer errors.

"What we want is the most accurate total available," he said.