Larry has a small janitorial service. He has three employees and his goal is to make enough money to pay each of them $100 a day – $15 an hour. Larry thinks he should make more for himself but he has to make $15 an hour. He bites the bullet with a dream to build his business and get his rewards in the future. He works at least 10 hours counting paperwork, insurance plus other red tape, and he has to buy and and maintain equipment. So let’s say he gets $150 a day for himself. Larry has to make $450 a day. Larry business has four contracts with small mall stores. He makes it work.
Mark, an employee is sick for two or three days. Larry and his workers are diligent. They work harder to make up time for the sick one. Mark takes paternity leave for a month. Larry loses one of his contracts because the cleaning is not up to par. Larry lays Mark off. Now he is subject to a lawsuit.
Larry decides it is not worth the effort so he disbands and competes with the other three for a job for someone else for $100 a day. Problem is that this is happening to many other small businesses and there is a flood of people applying for work.
The chances are some will lose motivation and join the couch sitters and food stamp receivers, lose their health, and become depressed, addicted, or suicidal.
All this is why I’m not in favor of any minimum hourly wage. People should be paid according to how much they can contribute to their business in quantity/quality. If you can make money or provide services needed for your boss, he/she will pay you to stay with him/her.
So President Biden orders a minimum wage for all federal contract employees. No problem for the feds. Just raise the taxes on the Larrys out there. That will get you votes, legal or otherwise.