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July 24th, 2009
12:49 PM ET

Financial Dispatch: 4.5 million people getting a raise today

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2009/images/07/24/art.check.jpg]
Andrew Torgan
CNN Financial News Producer

The federal minimum wage goes up to $7.25 an hour today from $6.55. But the increase brings up a continuing debate: will a pay increase help out workers at the bottom of the ladder? Or will it kill their jobs?

Opponents of the increase have long argued it could hurt job creation, especially during this recession. The economy has shed more than 3 million jobs so far this year and some economists believe the wage hike could drive the 9.5% national unemployment rate even higher.

But others believe that higher wages will lead to more spending by consumers, which would in turn help bring the recession to an end. One economist says the wage hike means more than $5 billion will be injected into the economy over the next year.

Minimum wage workers in 29 states will be getting the raise. It could be as low as 10-cents an hour in New York or as much as 70-cents in Texas.

Workers in 21 other states won't see an increase, because those states already pay more than $7.25 an hour.

The Economic Policy Institute in Washington estimates that more than 2.8 million workers will have their wages lifted to $7.25 an hour today. More than 1.6 million workers will also be indirectly affected, meaning their above-minimum wages will increase as the rising tide lifts all boats.

That adds up to nearly 4.5 million workers nationwide who would get a raise.

Go to CNNMoney.com to check out how your own state measures up.

Stocks struggle

Stocks opened to the downside this morning, one day after earnings optimism triggered a surge that pushed Wall Street to its highest level of 2009.

The Dow climbed nearly 200 points to 9,069.29 Thursday and touched its highest point since November, as investors cheered better-than-expected quarterly results and home sales.

But a number of technology companies – including Microsoft and Amazon - issued downbeat earnings reports after Thursday’s closing bell, and that could bring a halt to the rally.

The Nasdaq, by the way, was riding a 12-session winning streak coming into today – it’s best run since 1992.

Consumer confidence dips in July

Consumer confidence faded in late July to its lowest level since April on growing pessimism about the long-term economic outlook, especially about income and jobs, a survey showed Friday – despite signs the longest recession in decades may be easing.

The Reuters/University of Michigan Surveys of Consumers said its final July consumer sentiment reading fell to 66.0 from June's 70.8, though it was slightly higher than economists' median expectation for a reading of 65.0.

"Consumers believe that the economic free-fall is now over, but consumers see little reason to believe the stimulus policies will improve their financial condition anytime soon," the Reuters/University of Michigan Surveys of Consumers said in a statement.

On the long-term outlook, 58% of respondents said they anticipated bad times, up from 49% in May.

Lower income and less favorable job prospects in the next year are key factors making consumers anxious about their financial position.

Most lucrative college degrees

Math majors don't always get a lot of respect on college campuses, but fat post-grad wallets should be enough to give them the last laugh.

The top 15 highest-earning college degrees all have one thing in common - math skills. That's according to a recent survey from the National Association of Colleges and Employers, which tracks college graduates' job offers.

Engineering diplomas account for 80% of the top-paying majors. Topping the list is petroleum engineering. That’s by far highest-paying degree, with an average starting offer of more than $83,000, thanks to that resource's growing scarcity. Graduates with these degrees generally find work locating oil and gas reservoirs, or in developing ways to bring those resources to the Earth's surface.

Other highly-paid engineering majors include chemical engineers, who employ their skills to make everything from plastics to fuel cells and have an average starting offer of just under $65,000. Mining engineers and computer engineers also do well, typically landing a starting paycheck north of $60,000.

Follow the money… on Twitter: @AndrewTorganCNN


Filed under: 360° Radar • Andrew Torgan • Job Market • stocks
soundoff (12 Responses)
  1. Donna Wood, Lil' Tennessee

    In our dreams only! And that is my perspective on that!

    Donna Wood
    Lexington, Tennessee

    July 24, 2009 at 8:02 pm |
  2. Annie Kate

    Might not be much but for those who get it I bet they welcome every penny of it. I know I would.

    July 24, 2009 at 7:56 pm |
  3. Tim Gibson

    Wow, if they keep up the good work on making sure the wage is in line with current standards of living it will not be long before everyone can supersize that McDonalds order with the wind fall profits of this massive raise.

    July 24, 2009 at 7:26 pm |
  4. anthony

    i am glad. this is a good thing.It my not sound like alot to sme but its mean alot to alot of people out there. every penny counts.

    July 24, 2009 at 4:39 pm |
  5. earle,florida

    Consumer Confidence,holding it's own,Great! Stock Market holding it's own,even after Microsoft,and AMEX came in light,is great news. The "Minimun Wage"raise,is great for the economy,period! Now,a few words of where we've been,and where we are in my opinion only: The tomultuous ,"Financial Ocean"of unrelenting turbulence regarding our "Capitalist Market System" is at a precipice,where you can't see the "Skyline through the Seas",ever enduring,"Lost in the Light of Day",climbing a encapsulated "Wall of Worry",in undulated squalls. But ironically,as always, America's perpetuity,and resilience is saved once again through celestial guidance by "The Darkness" we've seem to have gained in our darkest hours. Thus,our direction whereas being born of mysterious vicissitudes have righted our present,and future voyage.Once again the financial markets seemingly are safe in port,finally harbored on "Wall Street"! Our "Stearn,Bowing To No-One! Go President Obama,...

    July 24, 2009 at 2:57 pm |
  6. don corpier

    i have heard the anti minimum wage cry babies for 40 years at least. its just like the automobile industry crying the blues every time congress passes new gas mileage increases. better yet is the credit card co.s they all moan and groan about how this is going to cause financial disaster. of course they all state their concerns about the negative effects it will have on the american public. since when did any of these creeps care about the public. most US companies-both public and private already pay several dollars above minimum wage. the only ones that dont are those that hire people that can barely read and write or illegal aliens. i would like to see one of our wonderful republican members of congress live on $1160 a month before taxes. if i am not mistaken that is well below the poverty line. god forbid if one of their cronies on wall street had to face this problem. most of these slime balls make that much in one day for doing nothing but fleecing the american public. this country makes me want to puke. i am a vietnam vet 1968 USMC-i will never lift a finger to protect any of these scum bags.

    July 24, 2009 at 2:49 pm |
  7. Teresa,OH

    Wow... the minimum wage is going up.... $7.25 an hour... and a gallon of milk is over $3 in my area... One must work for over half an hour to buy one gallon of milk. And if you buy two a week for the kids, you work for an hour to buy them milk.

    I think the whole thing wrong with the US is the pay scale. Yes, we are all equal, but not in our paychecks. We pay the burger flipper minimum wage to fix your burger how you want it, and then we diss their job. I think EVERY JOB in the US should have an option of joining a Union. Everyone likes to feel they are worthy and productive.

    I could almost cry when thinking of the paychecks that the Lawmakers who passed the minimum wage increase take home compared to the checks of the minimum wagers. Absolutely shameful.

    WE all know: the more money you make– the less work you do.

    July 24, 2009 at 2:32 pm |
  8. Melissa

    And its still not nearly high enough.

    July 24, 2009 at 1:37 pm |
  9. GF, Los Angeles

    If you don't pay workers a liveable wage, goods and services will not be bought because people can't afford it. How will that help the economy? Minimum wage is a joke out here in CA. It wouldn't even pay for a one bedroom apartment.

    July 24, 2009 at 1:05 pm |