Tuesday, December 8, 2009

$246,436 per job

Keep in mind that the average American worker makes $59,867 per year.

5 comments:

Evan said...

Of course, money gets spent on a lot of things other than jobs. If you spend $10 million on a road project that requires 100 new hires, it may have cost $100,000 per new job, but you also paid for a lot of supplies to go along with those people. Plus, there's the money you paid the existing employees of the company.

Measuring dollars per job created is a great way to score political points but it's (I think fairly obviously) a pretty useless statistic in an economic sense.

Lachlan said...

It's only useless if your objective is something other than creating jobs. So either that wasn't the goal of the stimulus, or the stimulus did not work as intended. I think either is a political sandbag for the administration.

Evan said...

That wasn't the only goal of the stimulus. Ostensibly another primary goal was ending the recession--that is, ending GDP growth.

Unless you think you can just pay people to do tasks with no infrastructure to support the work they're doing, you're going to be paying more per job than you pay in salary. Even if you literally paid people to dig holes all day and fill them, you'd need to buy them shovels.

Evan said...

And by ending GDP growth I meant restoring GDP growth. Whoops.

Lachlan said...

Of course there's something to be said there. My only concern then (assuming, and I know this is a very big assumption, that people who were employed by the stimulus were paid roughly the national average) is that the raw materials involved cost three times as much as the workers. I don't know the numbers, but I find that to be an unreasonably high cost for either creating jobs or creating infrastructure.