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The US Department of Labor announced that the guaranteed minimum wage for federal contractors will be increased to $15 an hour starting January 30, 2022.

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The wage hike would affect new contracts with government agencies and was part of a Executive Order Signed by President Joe Biden To raise the hourly rate for federal contractors to $10.95 in April.

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Unfortunately for some workers, the increased wages are only required in new contracts, so some working under existing federal contracts will have to wait.

Wages will be indexed for inflation, so it will automatically increase with each year to reflect changes in prices. The minimum minimum wage of $7.65 per hour for federal contractors will be replaced by the standard minimum by 2024.

“These workers are vital to the functioning of the federal government: from cleaning professionals and maintenance workers who ensure federal employees have safe and clean places to work, to the nursing assistants who care for the nation’s veterans. , cafeteria and other food service workers who ensure military members have healthy and nutritious food to eat for workers who build and repair federal infrastructure” White House said in a statement earlier this year.

the announcement Follows a similar move by former President Barack Obama In 2014, that raised the minimum wage for federal contractors to $10.10 an hour.

Biden has pushed for a nationwide minimum wage of $15 for all workers, making it a part of his COVID-19 relief package. But the Senate lawmaker said the pay hike did not comply with the budgetary rules that allowed the $1.9 trillion plan to be passed by a simple majority, so it was not included in the bill Which became law in March.

Currently, millions of Americans are still earning less than $15 an hour. The nonpartisan Congressional Budget Office calculates that even by 2025, about 17 million workers will remain below that level.

As employers hit hard by the COVID-19 pandemic struggle to fill job roles, $15 an hour has rapidly become a reality, especially in America’s service industry.

Businesses, especially those in the restaurant, retail and travel industries, are offering $15 salaries to try to fill enough jobs to meet growing demand from consumers, millions of whom are now in lockdown after a year. spending independently. And many unemployed, buoyed by stimulus checks and expanded jobless aid, feel able to hold out for higher wages.’

Change has accelerated since the pandemic. For years, and especially in the 2020 presidential race, labor advocates had trumpeted $15 an hour as wages that would eventually allow low-wage workers to afford basic necessities and narrow inequality. This struck many as a long-term goal.

Now, many staffing companies say that $15 an hour is the level many businesses must pay to fill their jobs.

“This number is not a coincidence,” said Aaron Sojourner, an economist at the University of Minnesota. “This is the number that those activists and activists put on the table 10 years ago, and created a movement.”

This story was reported from Los Angeles. The Associated Press and Kelly Hayes contributed.