Increase in Minimum Wage for Federal Contractors

Another Increase in Minimum Wage for Federal Contractors!

That’s right, the minimum wage for Federal contractors is increasing again. The Biden administration singed an executive order on January 1, 2023, which increased the minimum wage to $16.20 per hour.

It was only last year, April 2022, when the executive order was signed by Biden to increase minimum wage. The minimum wage for Federal contractors went up to $15.00 an hour. This increase came long after the previous increase by the Obama administration.

Back in 2014, Obama increased the minimum wage to $10.10. Imagine how happy minimum wage paid employees were to get the $4.90 raise.

The $15 was implemented on June 30, 2022, by the Labor Department. All employees of Federal contractors and subcontractors must be paid that minimum wage. Now they must accommodate another increase shortly after implementation of the first increase.

Fighting against the increase in minimum wage for federal contractors.

Biden’s executive order was in question back by attorneys for Indiana, South Carolina, Nebraska, Idaho, and Arizona. They sought an immediate injunction to block the new minimum wage for Federal contractors. However, the order was within the right of the Biden administration under the Federal Property and Administrative Services Act. His order promotes Federal contracting efficiency and economy.

Also, the Labor Department was on the Administration’s side saying that this increase in minimum wage for Federal contractors would not only reduce turnover but also increase morale. Another decision of the Labor Department was to extend this order to all subcontractors as well. This will deter contractors from simply subcontracting their jobs instead of hiring employees.

A few states sought to prove their case against the order saying that the order will make contractors lay off employees and let go of Federal contracting. They say it would increase unemployment rates in their respective States and decrease tax revenue. The judges realized that during both the Obama administration and the Trump administration there was no push back for their executive orders pertaining to the minimum wage for Federal contractors.

Who Benefits from Another Increase in Minimum Wage for Federal Contractors?

According to the estimates from the Labor Department, there will be around 300,000 employees who will benefit from the $16.20 minimum wage requirement. There is an expense for contractors over the next few years. However, the amount will come off their state taxable income so the impact shouldn’t be extensive.

Because of the order the Trump administration put in place, the only exception to the minimum wage requirement is seasonal recreational service employees working on Federal land. These contractors do not have to adhere to the $16.20 per hour. Other than those employees, all other Federal contractor employees will be part of the increase when it is fully implemented this year.

Balance the Minimum Wage for Federal Contractors

There are ways Federal contractors can combat the increased wages and balance their scales. Utilizing the marketing programs of Select GCR, Federal contractors can obtain more Government contracts. The services that Select GCR provide include:

• Positioning your business as a viable option
• Certifying your business for set-aside contracts
• Market research to find relevant contracts and contacts
• Introducing your business to thousands of Government contacts and agencies
• Proven marketing strategies to generate more revenue than you can imagine

What is Select GCR Pro?

Our proprietary Select GCR Pro tool has the capability to bring your contracting game to the next level. This amazing program provides real-time contact information pulled from every Government database available. It brings all of this information together in one convenient location and puts it right at your fingertips.

You can search for agency contacts, procurement agents, purchasing agents, contracting officers, prime contractors and much more. The contracts you can pull up are open solicitations from a Federal and State level, as well as re-compete contracts, expiring contracts and local opportunities. Searches can be performed based on NAICS codes, locations, keywords and more. We provide free access to this program for all of our marketing clients and we offer a stand-alone service to just the program itself.

Find out more information about Select GCR Pro and discover the power and potential it will bring to your business. The dollar amount of contracts you will be awarded courtesy of this program will offset the increase in minimum wage for Federal contractors. A little investment can go a long way in the Federal contracting world. What do you have to lose?