Economy

An Obama administration proposal to raise the minimum wage may not help as many low-wage earners as estimated.

The president said in weekly address that, taken as a package, his ideas will lead to a thriving middle class.

First-time claims for unemployment benefits dropped by 27,000 last week, a sign of the labor market's continued healing. 

Applications for unemployment benefits dropped to 341,000 for the week ended Feb. 9, the best showing in three weeks, which is back near a three-year low, the Labor Department said on Thursday. 

The four-week moving average, which provides a better indication of where the job market is headed, increased from what was a five-year low the previous week, up slightly by 1,500 to 352,500.

Advocates argue it will lift millions of low-wage workers out of poverty, but opponents say it would kill jobs.

"I always reported all income, I always paid all taxes," he said.

Speaker John Boehner (R-Ohio), the former chairman of the House Education and Workforce Committee, took issue Wednesday with President Obama's call for a higher minimum wage. 

Saying that he has dealt with the "minimum wage issue for the last 28 years," Boehner said that a higher minimum wage results in fewer jobs. 

President Obama is urging Congress to raise the minimum wage, a difficult political lift despite the struggles of low-wage earners. 

In his State of the Union address, Obama suggested that lawmakers consider raising the minimum wage to $9 an hour by 2015 from $7.25 an hour in an effort to provide working families with a better chance to exit low-income conditions. 

The president asked that the federal minimum wage also be indexed to rise automatically each year with the cost of living.

"Tonight, let’s declare that in the wealthiest nation on Earth, no one who works full-time should have to live in poverty, and raise the federal minimum wage to $9.00 an hour," Obama said. 

"This single step would raise the incomes of millions of working families.  It could mean the difference between groceries or the food bank; rent or eviction; scraping by or finally getting ahead."

Small businesses became slightly more confident in January, according to an industry index, but remain largely pessimistic about conditions. 

The National Federation of Independent Business (NFIB) said its optimism index ticked up for a second consecutive month in January, landing at 88.9.

NFIB's index had tanked in November, due to small business concern over the scheduled tax increases and spending cuts that were scheduled for the beginning of 2013.

Even with January's increase, the NFIB index remains lower than it was between October 2011 and October 2012. 

Bill Dunkelberg, the small-business group's chief economist, said in a statement that it made sense that companies would be feeling down, noting that recent estimates said the U.S. economy had also slightly contracted in the last quarter of 2012.

"If small businesses were publicly traded companies, the stock market would be in shambles," Dunkelberg said. "While corporate profits are at record levels as a share of GDP, small businesses are still struggling to turn a profit."

Once more: Economy looms large ahead of State of the Union. Read more...

Senate Finance Committee Chairman Max Baucus (D-Mont.) said Monday there is no reason his panel should not quickly confirm Jack Lew to be the next Treasury secretary.

However, the top Republican on the panel said Lew should be properly grilled, in particular when it comes to the time he spent at the bank Citigroup.

The tax writing panel is set to consider Lew's nomination Wednesday, and Baucus urged his colleagues to quickly advance the pick so they can get to work addressing the nation's fiscal issues.

"We have a tremendous amount of work to do over the next couple months to get our fiscal house in order," he said in a statement. "It is my hope that — after this thorough vetting process — Jack Lew will be quickly confirmed so he can help tackle our country's pressing economic issues."