Federal stimulus spending saved or created 2,566 jobs in Hawai'i during the first three months of this year, which is down from the 3,019 jobs attributed to the program during the last three months of 2009.

So far, most of the jobs created are in the government sector, according to figures released late last week by Recovery.gov, a clearinghouse for stimulus spending data. The job-creation figures show the stimulus program is helping Hawai'i's economy recover from a drop in visitor arrivals and declines in real estate and construction activity.

The data also indicate that economic activity spurred by the program remains concentrated in the government sector and may be peaking.

The state has been awarded $1.29 billion in stimulus money. That includes money for capital improvement projects, tax breaks, unemployment insurance and food stamps. About $585 million has been spent so far, according to Mark Anderson, the state's stimulus funding coordinator.

Stimulus jobs are expected to be created in waves, with government workers benefiting first, followed by the private sector as more public works projects get under way.

The decline in job creation in the quarter was a result of lower public education system spending from one-time grants. More private sector job creation is expected as government agencies execute contracts, Anderson said.

"We're about half-way, so we should see an equal amount of spending on the back end," he said. "We should expect increased private sector job reporting as we go forward because now we're getting to the part of the program when state government is contracting a firm to provide a service or a product and we're putting that money to the economy."

Executing those contracts, which include initiatives in alternate and renewable energy, health information technology and broadband, within federal guidelines and timeframes will be a challenge, Anderson said.

Stimulus program deadlines vary, but much of the money awarded to state agencies must be contracted out by the end of September and spent by April 2012.

During the first quarter, $218 million in stimulus money was spent in Hawai'i. There were 1,219 new and retained jobs attributed to state public education during that period.

The second-biggest job generator during the first quarter was a Maritime Administration drydock overhaul that created 109 jobs. Environmental Protection Agency drinking-water projects created another 61 jobs, according to Recovery.gov.

When jobs created indirectly by stimulus money are included, the total is much higher. In mid-April, the White House Council of Economic Advisers estimat- ed that the stimulus program created a total of 11,000 direct and indirect jobs in Hawai'i in the first quarter. That was up from an estimated 8,000 total jobs the prior quarter.

Determining the cumulative job impact of the stimulus program is difficult because the government changed the methodology for calculating jobs after the program was created.

Despite the large infusion of federal money that started last summer, there were 14,740 fewer jobs statewide during the first quarter, versus the first three months of 2009, according to the University of Hawai'i Economic Research Organization.

Most of the stimulus money is paying for highways and bridges, transit systems, clean-water projects, public housing improvements and affordable housing.

These projects include a $3.4 million deal with The Nature Conservancy to remove invasive algae from East O'ahu's Maunalua Bay. That project will create or save about 75 full- and part-time jobs, said David Ziemann, the program manager for The Nature Conservancy.

The plan is to remove mudweed from about 22 acres of the most heavily infested areas of the bay by March of next year. It took community volunteers about three years to clear 1 acre of algae, Ziemann said.

"That was the whole deal to be able to use this money to have a huge impact on this particular conservation effort with the expectation that it was going to be successful (and) would demonstrate that this is a useful conservation tool that could potentially lead to additional funding and application to other areas," he said.

Other stimulus projects include a $15.3 million contract to replace the 84-year-old South Punalu'u Stream Bridge with new concrete bridge. During the first quarter, the project generated 16 jobs. Hawaiian Dredging Construction is expected to complete the project by September 2011.

That bridge is one of 14 state roadway projects receiving $67 million in federal stimulus money. All but two of those projects are under way and one is completed, said state Transportation Director Brennon Morioka. Overall, 1,400 people have been employed by state and county stimulus roadway projects, he said.

The state expects to complete all projets within federally required deadlines, Morioka said.

"The final deadline is making sure all the projects are completely done and paid for by 2015," he said.

"I think we're well in advance of meeting that deadline."