Federal employees on average earned 27.54 percent less than private sector workers in similar jobs this year, according to an analysis released by the Federal Salary Council.
The Nov. 14 report shows that the disparity has grown significantly in just one year, up more than three percent from 24.09 in 2022.
President Biden confirmed earlier this summer his intention to give Federal civilian employees a 5.2 percent pay raise in January – making it the largest annual pay raise for Feds in 43 years.
President Biden said the across-the-board base pay raise will be 4.7 percent and locality pay increases will average 0.5 percent, resulting in an overall average increase of 5.2 percent.
But even that big of a boost won’t be enough to offset the growing wage gap between the Federal and private sectors of the nationwide workforce. At this point, it would cost $22 billion to bring General Schedule Federal salaries in line with the private sector, the President’s Pay Agent reported in October.
The percentage-based pay gap has remained in the low- and mid-twenties for several years, and has stayed consistently above 20 percent since 2007, the Federal Salary Council working group noted in its latest report.
Still, the new 27.54 percent figure isn’t the highest disparity Feds have seen in recent years. From about 2015 to 2018, Federal employees’ salaries fell more than 30 percent behind those in the private sector. The disparity was nearly 35 percent in 2015.
This year’s report shows that Silicon Valley in California has the highest pay disparity of 109.43 percent.
“The alarming new pay gap proves what federal employees have been feeling all year: Their paychecks are not keeping up with inflation and monthly bills are increasingly harder to cover,” said National Treasury Employees Union (NETU) president Doreen Greenwald. “It is outrageous that our nation’s civil servants have lost ground in the fight for fair pay, and it makes our push for an adequate raise in 2024 all the more urgent.”
NTEU – which represents 35 Federal agencies and offices – has endorsed legislation for an average 8.7 percent pay bump in 2024, which would include an across-the-board increase of 4.7 percent, plus an average four percent for locality pay.
“At a time when federal agencies are struggling to retain and attract talent, paying a competitive wage is even more important,” Greenwald said. “Every year the Federal Salary Council hears directly from local civic leaders across the country who plead for higher salaries so that federal employers in their areas can fill critically important vacancies. An across-the-board raise plus increases in locality pay will help agencies keep and hire the skilled employees they need to deliver vital services to the American people.”
Just last week, the Office of Personnel Management (OPM) finalized a rule to establish four new locality pay areas in Fresno, Calif.; Reno, Nev.; Rochester, N.Y.; and Spokane, Wash. – meaning more than 33,000 Federal employees will see additional raises in 2024.
Separately, Federal agencies can request special salary rates (SSRs) for typically hard-to-fill positions, like tech and cybersecurity.
Notably, OPM approved an SSR for the Department of Veterans Affairs (VA) to increase the basic bay for thousands of its IT and cybersecurity employees. Other government agencies have looked to implement similar pay raises, including the Department of Defense (DoD).
In May, the DoD approved a pay raise for STEM and cyber positions within its intelligence components, such as the National Security Agency, Defense Intelligence Agency, and National Geospatial-Intelligence Agency.
