President Obama will sign an executive order formally raising the minimum wage for federal workers during an event Wednesday at the White House.
The move, first announced during the State of the Union address, will raise the minimum wage for federal workers hired under new contracts to $10.10 per hour. It will also raise the tipped minimum wage to $4.90 from $2.13 per year, with an escalator clause that will increase that amount in subsequent years.
“The president is using his executive authority to lead by example, and will continue to work with Congress to raise the minimum wage for all Americans by passing the Harkin-Miller bill,” the White House said in a statement. “The bill would raise the Federal minimum wage for working Americans in stages to $10.10 and index it to inflation thereafter, while also raising the minimum wage for tipped workers for the first time in over 20 years.”
Obama has made the populist initiative one of his major talking points following his State of the Union address late last month.
Following his address, the president went to a Costco in suburban Maryland — where an average employee makes $20.89 per hour — and said Congress needed "to catch up to the rest of the country" on the issue.
Obama said "all our businesses work better when customers have more money to spend" and better wages for low-income workers "increase productivity and reduce turnover."
“It will give businesses more customers with more money to spend,” the president said. “I guarantee if workers have a little more money in their pocket, they’ll spend more money at Costco, and if Costco sees more customers, they’ll hire a few more folks.”
Organizing for Action, the political advocacy group borne from the president's reelection campaign, has also launched a national television campaign calling for a minimum wage hike.
Some Republican lawmakers, including Senate Minority Leader Mitch McConnell (Ky.), have opposed the push, arguing it could hurt growth.
"There's no question that the minimum wage increase, if not done in conjunction with some kind of incentives for the businesses not to lay off employees — are going to dramatically increase unemployment," McConnell told Fox News earlier this month. "I don't think in this jobless recovery, we ought to be doing things that creates fewer jobs. We ought to be doing things that create more jobs."
But some vulnerable Democrats have also been reluctant to embrace the idea. Sen. Mark Pryor (Ark.), who is facing a tough reelection this fall, told Bloomberg News he did not support setting the wage at Obama's proposed level.
“I know $10.10 still isn’t a whole lot of money, but I think it’s too much too fast,” Pryor said. "I'm not supportive of that."