Saturday 13 August 2011

70,000 jobs lost! Really?

An oft-repeated statement that the Federal Aviation Administration's partial shutdown has forced the layoff of 70,000 construction workers is, at best, an over-simplification, and at worst, an exaggeration, according to the expert behind the number.

Democratic leaders, and even some Republicans, quoted the 70,000 number frequently this week to emphasize the serious consequences of the shutdown.

But George Mason University professor Stephen Fuller, whose 3-year-old study was used by others to arrive at the 70,000 figure, said the estimate includes everything from actual construction workers, who were laid off, to drug store clerks and restaurant waitresses, who might see "a tiny bit less revenue flow."

The true number of laid-off construction workers is probably one-third of that figure, Fuller told CNN.

The rampant use -- and misuse -- of the 70,000 figure is a study in the wondrous ways of Washington, where facts and figures frequently enter the public debate filled with nuance and caveats, all of which are rapidly abandoned in the blazing heat of partisan battle.

The 70,000 figure entered the public sphere when the FAA turned to Associated General Contractors of America, a construction industry group, to calculate the economic impact of the FAA funding impasse.

The FAA had halted more than 200 construction projects totaling $2.5 billion.

AGC dusted off the 3-year-old study conducted by Fuller. His research, designed to show the "multiplier effect" of the president's stimulus package, concluded in early 2009 that $1 billion in nonresidential construction created or supported 28,500 jobs and added $3.4 billion to the Gross Domestic Product.

An AGC economist applied Fuller's formula to the FAA's $2.5 billion construction halt and came to the conclusion that it would put "24,000 construction workers out of work." Another 11,000 workers in related businesses "are also affected," the AGC said, and "as many as 35,000 jobs will be undermined in the broader economy, from the lunch wagon near the job site to the truck dealership across town."

The total number impacted -- in ways large and small -- was 70,000, the AGC said.

In a subsequent Department of Transportation news releases and statements, the information was abbreviated, losing much of its important nuance.

"AGC estimates that 70,000 construction workers and workers in related fields have been affected," the DOT reported in one news release.


NEWS BY:http://articles.cnn.com/2011-08-04/politics/faa.jobs_1_construction-workers-construction-halt-agc?_s=PM:POLITICS

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