The huge economic stimulus spending from the last two years has affected employment positively, according to aneconomic analysis by the Congressional Budgeting Office. The report notes that the conclusions can’t be tested against how the economy would have done without the stimulus, so the estimates are reported in rather wide ranges.
The report concludes that the unemployment rate reduced by a half percent to more than one percent, and that employment rose by anywhere from 900,000 to 1.9 million people.
The CBO refers to another study that concluded that the stimulus spending had a large positive effect during the spending period (which is over now), and then fell to almost zero. Some of the jobs created were temporary, such as people employed for the big construction projects, and some state and local government employment actually contracted because of the aid to state governments for Medicaid programs.
What the reports cannot capture is whether the spending averted a second great depression, in which case the expenditure was worth it. To people on the receiving end of a new job, even if it turned out to be temporary, the spending was worth it. The future impact of all that borrowing is something we’ll all live with, and maybe dealing with it will create new jobs.