Stimulus can save 4 million jobs

Obama's proposal targets alternative energy and infrastructure for investments he says will save existing jobs and create new ones.

WASHINGTON (Reuters) -- President-elect Obama said Saturday an analysis of his stimulus proposals shows that between 3 million and 4 million U.S. jobs could be saved or created by 2010, nearly 90% of them in the private sector.

The analysis of Obama's estimated $800 billion plan to lift the country out of a year-long recession was submitted by the chair of his council of economic advisers, Christina Romer, and by Vice President-elect Joe Biden's chief economic adviser, Jared Bernstein.

Obama announced the report on his weekly radio and Internet address. He had previously said his American Recovery and Reinvestment Plan would create or save 3 million jobs, but said the analysis from his advisers showed that number would range between 3 million and 4 million.

"The jobs we create will be in businesses large and small across a wide range of industries," Obama said. "And they'll be the kind of jobs that don't just put people to work in the short term, but position our economy to lead the world in the long-term."

His radio address comes just after official figures showed U.S. employers slashed more than half a million jobs from their payrolls in December, pushing the unemployment rate to 7.2% and bringing the total number of jobs lost last year to 2.6 million - the most since 1945.

Obama said his plan would create nearly 500,000 jobs by investing in clean energy, by committing to double the production of alternative energy in the next three years and by improving the energy efficiency of 2 million American homes.

"These made-in-America jobs building solar panels and wind turbines, developing fuel-efficient cars and new energy technologies pay well, and they can't be outsourced," he said.

Repairing infrastructure
Obama also said the report showed the recovery plan - which analysts have estimated will cost about $800 billion - will also put nearly 400,000 people back to work repairing infrastructure like crumbling roads, bridges and school and laying down miles of broadband lines.

"Finally, we won't just create jobs, we'll also provide help for those who've lost theirs, and for states and families who've been hardest-hit by this recession," he said.

"That means bipartisan extensions of unemployment insurance and health care coverage; a $1,000 tax cut for 95% of working families; and assistance to help states avoid harmful budget cuts in essential services like police, fire, education and health care."

Obama, who has faced tough opposition from both Republican and Democratic lawmakers over his recovery plan especially regarding tax cuts, repeated a warning that recovery will not come overnight and the situation could likely get worse before it gets better.

"But we have come through moments like this before," he said. "I am confident that if we come together and summon that great American spirit once again, we will meet the challenges of our time and write the next great chapter in our American story."

Though Obama did not mention it in the radio address, the report suggested that tax cuts, especially temporary ones, and fiscal relief to the states are likely to create fewer jobs than direct increases in government purchases.

"However, because there is a limit on how much government investment can be carried out efficiently in a short time frame, and because tax cuts and state relief can be implemented quickly, they are crucial elements of any package aimed at easing economic distress quickly," the report said.