CA: California high-speed rail jobs estimate too good to be true

Though California's high-speed train faces an intensifying backlash over its $99 billion price tag, political leaders from Washington to Sacramento justify the cost by touting another huge number: 1 million jobs the rail line is supposed to create.

But like so many of the promises made to voters who approved the bullet train, those job estimates appear too good to be true.

A review by this newspaper found the railroad would create only 20,000 to 60,000 jobs during an average year and employ only a few thousand people permanently if it's built.

"They have a really hard sales pitch with the real numbers, so they've fudged the numbers," said state Sen. Doug LaMalfa, a Chico-area Republican who is introducing legislation to send the rail line back to voters. "C'mon, a million people working on a 520-mile railroad? I practically laughed out loud when (I heard that)."

One million people -- more than the combined workforce of San Jose and San Francisco -- would have to cram shoulder-to-shoulder just to fit along the rail line between San Francisco and Anaheim.

In trying to win over a skeptical public to support the most expensive public works project for any state in U.S. history, Gov. Jerry Brown, the Obama administration, Democratic lawmakers and big city mayors such as San Jose's Chuck Reed have repeated the 1-million-jobs mantra.

"The facts are clear: Over 1 million good-paying jobs will be created," House Minority Leader Nancy

Pelosi said in a statement last week.

But state leaders, it turns out, quietly beefed up employment estimates. First, they counted every year of work as a separate job. So if one person were to work 10 years, that would count as 10 jobs. Next, they figured outside companies, such as restaurants and retailers, would hire two new people for every single construction worker.

Grand total: 20,000 construction workers and 40,000 "spinoff" employees -- each working the entire 22-year project -- would count as more than 1 million jobs.

In reality, high-speed rail's construction jobs would lower the state's current unemployment rate from 11.3 percent to just 11.2 percent.

"Job-years and jobs are like apples and Twinkies, they're not even in the same food group," said Elizabeth Alexis, a Palo Alto analyst who testified before Congress about the project last week. "It's not accurate, and it's misleading; (most of the) people who thought they're getting jobs are not getting jobs."

'Shorthand' conceded

Project officials conceded they need to explain the job figures more clearly, particularly with their credibility on the line.

"To the extent that we use jobs, it's been as a shorthand (for years of employment). It's an easier way," said Dan Richard, who Brown appointed to the California High-Speed Rail Authority Board controlling the project. "It's absolutely fair that we should be more disciplined about that going forward. At the end of the day, I don't know if it really changes anything. The bottom line is if you're unemployed, you don't care if it's jobs or job-years."

Government agencies routinely calculate temporary construction jobs by the year, but it's unusual for public officials to lump all those estimates together. For instance, the White House tells recipients of stimulus funds not to count workers multiple times like officials have done on the rail project, which received $2.25 billion from those grants.

It's also common for planners to calculate spinoff jobs for huge public works projects. But unlike high-speed rail, they usually separate construction and spinoff jobs in touting the numbers, like the Valley Transportation Authority does when promoting the BART extension to San Jose. And not everyone agrees high-speed rail will be the economic boon for outside industries that officials are assuming, particularly since construction would begin in a remote Central Valley location.

Critics say the job questions are just the latest example of supporters misleading the public.

When voters approved the project in 2008, they were told it would cost $33 billion, a price tag that has since roughly tripled. Since the vote, the start date of full service also has been pushed back from 2020 to 2034, expected rider counts have dwindled and sources of funding have dried up. A Field Poll earlier this month found less than one-third of Californians would approve the project today.

Key differences

Michael Rossi, Brown's jobs czar and another project board member, said "there was no plan to mislead anyone by manipulating the numbers."

But supporters always publicly refer to the huge employment totals as "jobs" -- sometimes even saying that the first leg of the project will put 100,000 "people" to work -- without explaining that the figures represent years of work, and that two-thirds of the jobs are expected spinoff positions.

"They want you to believe that when this thing gets under construction that there are 100,000 individual bodies working around on this project, which is totally bogus," said Aaron Fukuda, co-chair of a Central Valley group aimed at holding the rail authority accountable. "They're trying to legitimize a false number."

What's more, officials have not taken into account the potential job losses from the railroad, which will displace many businesses along the train route, including several along the Caltrain corridor between San Francisco and San Jose. And within the last month, the California Legislative Analyst's Office said other state programs could cut jobs so the state can afford the $20 billion debt to pay its portion of the rail line.

Rail authority spokeswoman Rachel Wall said the first leg of construction "will create a ripple effect throughout the state" and provide desperately needed paychecks, particularly within the hard-hit construction industry. In addition to temporary construction jobs, the rail authority expects to hire a staff of 4,150 permanent workers to run the railroad.

Despite the evidence, supporters are not expected to abandon their jobs campaign anytime soon.

"However you tabulate the exact jobs and spinoff economic activity numbers," said U.S. Rep. Dennis Cardoza, a Central Valley Democrat and supporter, "there is no doubt that this project will provide an economic boost in the San Joaquin Valley, where unemployment figures are among the highest in the nation."

Contact Mike Rosenberg at 408-920-5705.

The official tally
1 million: Estimated in job-years, meaning that if a person works a job for 10 years, it's counted as 10 jobs.

What we counted
60,000 total: There will be 20,000 construction workers and as many as 40,000
"spinoff" workers at a time.

AFTER CONSTRUCTION
4,150: The number of permanent employees who are projected to work on the railroad if it is fully built.

Source: http://feeds.stateline.org/~r/StatelineorgRss-EconomyBusiness/~3/Ft7IV39kUNg/ci_19596037

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