We have estimated how the net cost per job would change if the public employment program described in the Budget Committee staff paper entitled, "Employment," was changed as follows: (1) The average annual wage was changed from $6,820 to $6,000. (2) The average annual cost per job was changed from $7,733 to $7,300. The other assumptions remained unchanged. Namely, (1) 32 percent of the job holders received only unemployment compensation of $75 per week. (2) 28 percent received food stamps of $20 per week in addition to $75 weekly in unemployment compensation. (3) 20 percent received $35 per week in food stamps and the federal share of welfare payments (4) 8 percent received only food stamps equal to $20 per week. (5) The remaining 12 percent receive nothing from the federal government. The table below gives the cost for a million jobs program. Both the direct and indirect costs are roughly proportioned to the number of positions, the costs for programs of different sizes can be calculated easily. For example, a 700,000 jobs program would have a gross, direct, and net cost of $5.1 billion, $2.9 billion, and $1.5 billion respectively; or a 300,000 jobs program would have a gross, direct, and net cost of $2.2 billion, $1.3 billion, and $0.7 billion respectively. Preface This paper was prepared for the use of the Senate Budget Committee in connection with its markup of the First Concurrent Resolution on the Budget for Fiscal Year 1977. The report was prepared by Franklin Jones, Arnold Packer, Heather Ross, and Lauren Walters of the Senate Budget Committee staff and by Joel Bergsman and Peggy Cuciti of the Congressional Budget Office. |