For the first time in close to 10 years the federal government is kicking in money for summer jobs for young people. More than $2 million is expected for Boston's program alone from the American Recovery and Reinvestment Act, out of $25 million set to flow through the state.

"There has not been a federally funded summer jobs program in 10 years," said Conny Doty, the director of jobs and community services at the quasi-governmental Economic Development Industrial Corporation, the company that allocates workforce development money for the city of Boston.

The federal money is specifically for those from low-income households, making it likely that many from Dorchester will be able to take advantage.

"Clearly there's going to be a lot of young people from Dorchester who get these jobs," said Doty.

But the new money might not be enough money to handle an expected rise in demand for teen jobs while the number of hires in the private sector shrinks along with the economy.

Budgets are still working their way through the State House and City Hall, but early indications predict an increase in funding for Boston's summer jobs programs over last year. Doty is expecting near $2.5 million from the state's funds, an 18 percent increase over 2008. Last year the city spent $3.5 million on its program, run through the Hope Line, but this year's funding is still unclear.

The Menino Administration is struggling to close what they now say is a $100 million budget deficit. The projected shortfall was downsized this week from an earlier estimate of $140 million, as bean counters calculated in the effects of the expected federal stimulus and wage freezes accepted by 18 of the city's 44 employee unions.

"It's a little to soon to be talking about [summer jobs money]," said Menino spokesman Chris Loh on Monday. "The city budget is still being worked out. We're not sure exactly what's going to happen."

The city's Hope Line closed down earlier this month, its deadline a little later in the year than normal. A public hearing on March 24 in the Central branch of the Boston Public Library's Raab Auditorium will help guide the city how to spend the funds it eventually allots to the program.

In 2008, the wider effort, which included jobs available via the Hope Line, Action for Boston Community Development, Inc. and the Boston Private Industry Council, which lobbies private businesses to hire teens, found jobs for 8,656 youth at a cost of $5.6 million to the city and state.

If the city level funds the summer jobs program at 2008's $3.5 million, the added federal funding could jump the total to over $8 million.

"It'll be a huge factor this year," said Doty of the federal funds. "Last year was the lowest rate for teen employment in the United States since they started taking records in 1948."

The number of total jobs will also depend on BPIC, which helped find close to 4,000 private sector jobs for teens in 2008.

According to the Center for Labor Market Studies at Northeastern University, teen employment was at only 32.7 percent nationwide last summer, compared to 45 percent in 2000. Black, Asian and Hispanic teens led the downward trend.

With that increased demand, many are still skeptical that the program will come anywhere close to hiring all who apply. The last time that was the case was in 2000, said Doty, when close to 11,000 young people got jobs. But in 2000, the state was near full employment, compared to last month's seasonally adjusted 7.4 percent unemployment rate. Boston's teen population has also increased since 2000, just as teen employment has plummeted.

Additionally the federal money - though focused on youth whose household incomes are at or below poverty level ($26,000 a year for a family of four) - defines youth as those between 14 and 24 years of age.

Mark Isenberg, vice president of workforce development at ABCD, said that expanded definition would create an even larger demand.

"A kid who is living alone and unemployed certainly would be eligible," Isenberg said. "Given the fact that unemployment for youth is at an all time high, I would anticipate that we're going to see an even greater number of applications for what still is a limited resource."

The state money is targeted toward those at 130 percent of poverty level and below, whereas the city funded jobs carry residential requirements but are more flexible on income requirements.

ABCD will control a mix of state and federal funds, and those interested can apply at the Dorchester Neighborhood Service Center on Claybourne Street, the Elm Hill Family Service Center on Elm Hill Avenue, or the Mattapan FSC on River Street.

BPIC's director Neil Sullivan, whose organization is responsible for bringing in private sector jobs each year, said this week that things are looking promising on that front. His annual plea to large employers like hospitals, insurance companies, and banks, turned up numbers that are similar to last year's.

"I would not necessarily have predicted that a month ago," said Sullivan. "I think it's just a sense of a divine mission and the importance of this. On the one hand you have a bad economy, on the other you have a president who's talking about the high school dropout rate in his major speeches."

Sullivan said the race to garnering 4,000 private sector jobs or more for teens is now dependent on getting one or two jobs each out of hundreds of smaller employers, many who are likely to be reeling from the economic recession.

BPIC's job line is 617-542-WORK.