Monday, July 05, 2010

Concerns that that the stimulus won't stimulate enough

Interesting reading - (link) especially this part:

There are several factors hampering the Recovery Act, experts said. A primary one is that states' budgets are in such bad shape that they continue to shed jobs and slash spending despite stimulus infusions.

Also, contractors have to jump through many government hoops to get stimulus funding, said John Slye, principal analyst at Input, a market research firm for government contractors. That's one reason why a relatively small percentage of project funding has been distributed.

"It's taking agencies so long to get this money out into the economy," he said.

Though stimulus funds were meant to bridge the gap until the private companies started hiring again, employers have been reluctant to add to their payrolls.

In the construction sector, for instance, spending fell 8% in May compared to a year ago, even though stimulus-funded work picked up. Private non-residential construction sagged 25%, according to an analysis of Census Bureau data by the Associated General Contractors of America.

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