$787 Billion to Fight Foreclosures with Jobs

by on Foreclosure Help

An estimated total of 750,000 jobs would be developed or saved by August under programs launched by the administration of President Obama to fight the effects of foreclosures.

According to President Obama’s Council on Economic Advisers, the American Recovery and Reinvestment Act, which was funded by $787 billion, will save or develop thousands of jobs in about three months.

The estimated additional jobs are expected to reduce or halt the rising unemployment rate, which has been a major factor in the continued increase in foreclosures in many areas of the nation.

The council reported that the act was designed to save or develop 3.5 million job slots by 2010. The act also funds the creation of more job creation programs to be able to create 6.8 million job slots by 2012.

Last month, President Obama explained in his meeting with the press that the stimulus program has already saved or created 150,000 jobs and that more jobs are expected to be created or saved.

An official with President Obama’s administration said that the 150,000 estimate was conservative because calculations were based on conservative indicators. He could not however state what kinds of jobs were created and where they were created. He added that states are still compiling their job creation reports.

Officials with the administration have been careful about saying that the stimulus program has stopped job losses because the unemployment rate has continued to rise to higher levels. They just say the job creation program has slowed down job losses and indirectly foreclosure home for sale. The jobless rate in April has jumped to 8.9 percent, the highest unemployment level in 25 years.

Christina Romer, chairperson of the Council on Economic Advisers, said the council will make job loss and job creation reporting more accurate beginning in August. She said she will update Congress about the progress of job creation programs every quarter.

The council says that the reported impact of the economic downturn largely caused by foreclosures on employment is lower than the impact on GDP because they used conservative factors in estimating the effects of the economic crisis on employment.

Additionally, the council reported that the government spends around $92,000 to develop one job that lasts for a year. It says that the method used does not include differences in wage levels and other factors in different areas of the country and indirect factors such as foreclosures.