President Obama’s announcement that he will raise the minimum wage to $10.10 per hour for workers on new federal government contracts for services is welcome news. This is an important step and builds momentum toward a national increase – which is particularly needed for women, who are nearly two-thirds of minimum wage workers, and women of color, who are nearly four out of every ten female minimum wage workers. President Obama’s announcement comes on the heels of years of advocacy to raise the federal minimum wage for all workers, which currently stands at $7.25 per hour. Congress has raised the minimum wage only three times in the past 30 years.
Although it’s hard to imagine, many Americans who work on federal contracts are paid very low wages. One survey of federal-contract employees found that 74 percent earn less than $10 an hour, one in five depend on Medicaid for their healthcare [PDF], and 14 percent rely on food stamps. Once the minimum wage is in effect for employees on new federal services contracts, there are some families that will immediately be pulled out of poverty, and many others that will see a tangible improvement in their economic well-being. Raising pay for these workers is an important step toward raising the minimum wage to $10.10 for all workers, which would lift millions more out of poverty and – because women are the majority of workers who would benefit – would help close the wage gap.
This great news from the White House also highlights the critical steps the President can take on his own to lift American families out of poverty and close the wage gap. Here’s what President Obama could do next to ensure that women earn their fair share:
- As the New York Times editorialized this morning, President Obama should ban punitive pay secrecy policies. All too often, wage disparities go undetected because employers maintain policies that punish employees who voluntarily share salary information with their coworkers. When employees fear retaliation, there is a serious “chilling effect” on any conversations about wages. One report shows that nearly half of all workers nationally are either contractually forbidden or strongly discouraged from discussing their pay with their colleagues. As a result, it takes some workers years to learn they are being paid unfairly, and many pay disparities go undetected.
- President Obama should urge the Department of Labor to move forward swiftly with proposed regulations, set to be issued this month, regarding the compensation data collection tool to assess federal contractor compliance with the non-discrimination requirements of Executive Order 11246. Collecting compensation data and breaking down this data by race, sex, and ethnicity is crucial to the Department of Labor’s equal pay enforcement efforts and will aid federal contractors in bringing themselves into compliance with the law.
The executive order raising the minimum wage for employees on new federal contracts is definitely cause for celebration—and an opportunity to reflect on what else President Obama could achieve for women workers before the end of his presidency.