In a Wall Street Journal op-ed this week, two Treasury Department officials made the case for an additional round of Paycheck Protection Program funding, noting that “its success has been pivotal in supporting the recovery.” The op-ed pushed back against claims that the PPP has had a minimal effect on jobs.
According to Treasury’s analysis of PPP loan data, “counties that received PPP loans early saw smaller unemployment jumps in April and May.” Treasury researchers further extrapolated that “the cost of each job saved was less than $30,000, indicating that PPP not only was highly effective at saving jobs, but also did so in an extremely cost-effective manner.”
“PPP’s scale and speedy implementation were crucial to avoiding a slow, years-long recovery like the one that followed the 2008-09 financial crisis,” wrote Michael Faulkender, assistant secretary for economic policy and Stephen Miran, senior adviser for economic policy. “PPP is one of the main reasons why the unemployment rate peaked at only 14%, and why it took a mere six months to decline by more than half from its peak.” They recommended that additional rounds of PPP “should be targeted at smaller firms” and that “the best use of taxpayer dollars is to target firms most in need of assistance.”