In tonight’s State of the Union Address President Obama will announce an increase in the minimum wage for federal contractors to $10.10 per hour and he will call on Congress to pass a proposed similar wage increase for all workers.
The morning of Jan. 28, the White House released a preview of the President’s executive order that said he will use his executive authority to raise the minimum wage for new federal service contracts to $10.10 and index the minimum wage to inflation moving forward.
The executive order will cover workers performing services or construction such as janitors, food service workers and construction workers. The increase takes effect for new contracts after the executive order’s effective date, which the White House says gives contractors enough time to prepare and adapt their bids to reflect the wage increase.
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Federal contractor employees in some industries already receive wages higher than the federal minimum wage of $7.25 under a set of laws that require government contractors to pay workers the prevailing local wages received by counterparts in the private sector.
That has not always benefitted employees who work in historically low-wage industries like food service. Workers in such industries have been staging protests and demonstrations nationwide in recent months to pressure employers into paying higher wages. A handful of those demonstrations took place in Washington, D.C., and were targeted at pressuring federal government contractors that operate food courts in buildings such as the Pentagon, Union Station and the Reagan International Trade Center to increase workers’ wages. Those protests also called for an executive action like what the administration will announce in the State of the Union.
Platform May Have Little Traction
In last year’s State of the Union address, Obama proposed raising the federal minimum wage from $7.25 per hour to $9. Since then his administration has signaled its support for the Harkin-Miller bill that would push the wage to $10.10 per hour for all covered workers, and continued support is expected in his 2014 address. However, there is widespread skepticism that any effort on the Hill to change the current minimum wage would get much traction in the current political climate.
DOL Efforts to Push Higher Wages
The administration, particularly the U.S. Department of Labor, has been pushing the minimum wage debate to center stage in recent weeks, sparking speculation that Obama is making the minimum wage the centerpiece of an anti-poverty message as the next election cycle moves closer.
As the date for 2014 State of the Union address moved closer, DOL was especially active in promoting a higher minimum wage. On Jan. 23, Secretary of Labor Thomas Perez held a roundtable discussion with business leaders from several industries about raising the minimum wage. A week before, he made remarks at a minimum wage press conference with senior Democratic leaders on the Hill.
Debate Is Not Just National
The debate is not only happening on the national stage. A recent analysis by the Associated Press found that lawmakers in at least 30 states are pushing state-level minimum wage legislation. Congressional Democrats’ efforts to push an increase for the national minimum wage may face an uncertain outcome, despite support from the White House, but a state-by-state strategy could help the movement gain some traction locally.
In 2014, more than a dozen states raised minimum wage rates, including many that already have state wages above the federal minimum of $7.25. California ($9.00 beginning July 1, 2014), New Jersey ($8.25), Oregon ($9.10), Vermont ($8.73) and Washington ($9.32) are among the states that increased their minimum wages. Maryland Governor Martin O’Malley (D) made pushing through a higher minimum wage during his last year in office a cornerstone of his State of the State address in mid-January.