Biden raised the minimum wage to $15 for federal contract workers. What does that mean for NC businesses?

Wake County News

RALEIGH, NC (WNCN) — Government contractors will soon see a bump in pay after an executive order mandated $15 an hour pay.

“This is definitely a positive step forward that will benefit a small segment of the workforce,” said John Quinterno of the Duke University Sanford School of Public Policy.

The executive order could impact as many as 390,000 contractors, but the raise may not be as big as you think.

“Federal employees are already paid a minimum wage of $11 an hour so it’s not the same gap as you would have taking it from the $7.25 that applies to most workers,” said Quinterno.

Duke professor John Quinterno says the biggest benefit we will see in North Carolina is a leveling of the playing field for local businesses.

“It will make it harder for them to be undercut when they bid on government contracts,” said Quinterno.

However, NC State University professor emeritus Mike Walden argues that it could have businesses that already run-on small profit margins looking to cut costs.

“Some people will win,” said Walden.  “Some people will win big, but you are going to have folks that lose their jobs, or lose their hours.”

That could put pressure on local employers to follow through on a President Joe Biden campaign promise.

“There’s still a goal by the Biden administration to get the minimum wage up to $15 an hour,” said Walden.

“This is an example of when the Federal Government can use its power as an employer, and a purchaser, to really model good labor practices,” said Quinterno.

The raises will be phased in through 2022.

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