The economy’s still down, but corporate profits are up, and so is the Dow Jones Industrial Average. The Wall Street Journal reports that the Dow cleared the 9,000 mark for the first time since January yesterday, on the strength of “better-than-expected profit reports from the likes of Ford, eBay and AT&T.” The index is now up more than 38 percent since its low point five months ago, though still down nearly as great a percentage from its 2007 high.
In The New York Times, meanwhile, Jason DeParle reports that as the number of Americans seeking unemployment relief has doubled, the system set up to help them has collapsed. The recession would have created a strain on any program, but a years-long lack of investment in technology and personnel has left many states unprepared. As a result, applications are slow to be reviewed, and payments are slow to be made. The site of the worst problems seems to be, unsurprisingly, California. “As in most other states,” DeParle writes, “its 30-year-old computer runs on Cobol, a language so obsolete the state must summon retirees to make changes.”
Coincidentally, up in Maine, the Sun-Journal reports on the same problem today. A staffing shortage at the state Labor Department last December meant that “more than 100,000 calls from Mainers seeking benefits”—many of them, no doubt, repeat calls by the same people—“were abandoned weekly.” Workers have been added since then, but a bottleneck still exists, slowing down casework.
The other big economic story is the federal minimum wage increase that goes into effect today, lifting the lowest hourly wage from $6.55 to $7.25 in thirty states (the remaining twenty have higher minimums in effect). Coverage varied widely, with some outlets emphasizing the law’s effect on workers, others the burden it may place on businesses. The Atlanta-Journal Constitution went for balance, noting in its lede that “the minimum wage takes effect today, putting a bit more money in the pockets of low-paid workers but adding to employers’ costs at a time when many are struggling.” The Associated Press story, on the other hand, opens by warning that the increase “could prolong the recession, some economists say, by forcing small businesses to lay off the same workers that the pay hike passed in better times was meant to help.”
The Houston Chronicle takes a sunnier approach, asking low-wage workers what they plan to do wit the extra cash. (Answers include pay for college, finish pilot’s training, rebuild a classic car, save for a new Lexus.) The Dallas Morning News, meanwhile, cautions against expecting that much will change. “[M]inimum-wage earners interviewed said that while they’re grateful for today’s raise, they don’t expect it to measurably improve their lot,” the paper reports.
Finally, in stimulus news of the day, Montana Gov. Brian Schweitzer sat down with a local TV reporter to talk about how the state will use its $1 billion share of federal funds. Border patrol stations, road construction and energy efficient schools are on the agenda.Greg Marx is an associate editor at CJR. Follow him on Twitter @gregamarx.