The U.S. government is handing out nearly $2 billion US for new solar plants that President Barack Obama says will create thousands of jobs and increase the use of renewable energy sources.

Obama announced the initiative in his weekly radio and online address Saturday, saying the money is part of his plan to bring new industries to the U.S.

"We're going to keep competing aggressively to make sure the jobs and industries of the future are taking root right here in America," Obama said.

The two companies that will receive the money from the president's $862-billion economic stimulus are: Abengoa Solar, which will build one of the world's largest solar plants in Arizona, creating 1,600 construction jobs; and Abound Solar Manufacturing, which is building plants in Colorado and Indiana.

The Obama administration says those projects will create more than 2,000 construction jobs and 1,500 permanent jobs.

Obama's announcement came a day after the U.S. Labor Department reported that employers slashed payrolls last month for the first time in six months, driven by the expected end of 225,000 temporary census jobs. Meanwhile, private-sector hiring rose by 83,000 workers.

The unemployment rate dropped to 9.5 per cent.

Obama said that while it may take years to bring back all the jobs lost during the recession, the economy is moving in a positive direction.

He placed some of the blame for the slow pace of recovery on Republicans, saying GOP lawmakers, "are playing the same old Washington games and using their power to hold this relief hostage."

Obama has said that to bring the country's economy back from the brink of a depression, it was necessary to add to the country's debt in the short term.

Republicans have tried to capitalize on that growing sum. Georgia Senator Saxby Chambliss said in the Republican's weekly address that the country's $13-trillion US debt is a national security issue that will leave the U.S. vulnerable and force future generations to "pay higher taxes to foot the bill for Democrats' out-of-control spending."