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In his State of the Union address on Jan. 28, President Obama promised to work with Congress to pass a bill that would increase the federal minimum wage to $10.10 and index it to inflation thereafter. That represents an increase to the federal minimum wage of nearly $3 per hour and, more importantly for Oregon employers, an increase of nearly $1 per hour to the minimum wage they would have to pay.

Although support for a significant minimum wage increase is gaining momentum nationwide (Delaware, for example, raised its minimum wage last month, and the city of SeaTac, Wash., raised its minimum wage to $15 per hour in November), the legislation is considered unlikely to pass in an election year.

Obama, knowing he would have an uphill battle in Congress, last month signed an executive order that raised the minimum wage to $10.10 for people working on certain types of new federal contracts. The executive order covers workers under new federal contracts in the construction industry or who are performing services, and who previously would have been paid less than $10.10 an hour. Examples include civilian workers on military bases who wash dishes, serve food and handle laundry.

Obama believes that boosting wages will reduce turnover, increase morale and lead to higher productivity overall. He points out that when Maryland passed its living wage law for companies contracting with the state, more contractors began to bid. More competition can help ensure better quality.

Microsoft co-founder Bill Gates urged caution, however, and said the policy would create an incentive for employers to “buy machines and automate things.” Gates appears to be right. Robotics and automation are already displacing workers at a higher rate than ever before.

For example, The U.S. Bureau of Labor Statistics reported in 2012 that the number of general merchandise retail stores has grown by 23 percent over the last 10 years, while total employment at those companies has fallen by 6 percent. Much of this is due to self-service checkout counters that reduce the need for salespeople and checkers.

Robotics and automation are already having a significant impact on employment in manufacturing and health care. A major increase in the minimum wage may drive automation in other industries as well. For example, Oregon is home to Intellibot, a manufacturer of R2D2-like, industrial floor-scrubbing robots that incorporate up to 19 sensors allowing them to operate and clean without the use of a hands-on operator. A minimum wage of $10.10 may make this kind of robot more attractive and lead to a reduction in custodial employment.

The fast food industry also is in a position to become automated. Andy Puzder, CEO of Carl’s Jr.’s parent company, CKE Restaurants, has warned legislators that a higher minimum wage is “encouraging automation.” Software that allows customers to order their food without relying on wait staff, and machines that can make hamburgers faster, more hygienically and more uniformly than human workers, are already being tested in some large restaurant chains. A higher minimum wage will only cause automation to be ushered in more quickly.

If not a robot, then maybe a drone

Amazon made big news recently when CEO Jeff Bezos announced a bold plan to use drones to cut Amazon’s delivery time to 30 minutes after an order is placed. Last month a Minnesota microbrewery tested drones to deliver its beer to thirsty ice fishermen on midsize lakes. The Federal Aviation Administration, however, quickly shut the brewery’s test flights down.

While concerns tied to safety and other issues keep commercial drone delivery illegal, the FAA is reviewing a set of guidelines and expects to publish proposed rules on small unmanned aircraft less than 55 pounds later this year. Regulations governing commercial drones are expected to be issued in 2015.

In Oregon, HB 2710 was signed into law on July 29, 2013. The new law addresses a number of safety and privacy issues surrounding the use of drones in Oregon. It makes illegal the use of weaponized drones by the state, city and local governments as well as private individuals. And it makes inadmissible any evidence obtained by drones that have not been approved by the FAA. Interestingly, the law’s restrictions on the use of drones to gather evidence will be repealed by the same statute on Jan. 2, 2016.

Regardless of the conclusions that the FAA reaches, there is no doubt that emerging technology will have an impact on commercial drivers. Whether packages are delivered by drone or by driverless vehicles now being pioneered by Google and others, the handwriting is already on the wall declaring that in the not-too-distant future, fewer jobs will require humans to operate vehicles.

Don Stait is Special Counsel in Littler Mendelson’s Portland office. Contact him at 503-889-8874 or [email protected].