Federal Employees in Line for Largest Pay Hike in 40 Years

Largest Pay Hike in 40 Years: President Biden formalised his proposal to grant the largest pay rise to federal employees in four decades.

In a formal letter to the House and Senate leadership, the President outlined his plans for a 4.7 percent pay increase across the board in 2024, with average locality pay increases of 0.5 percent. This will result in an average increase of 5.2% for all federal civilian employees.

The President first recommended the 5.2% rise in his budget for fiscal year 2024.

It would be the largest increase since federal employees received a 9.1% pay rise during the Carter Administration in 1980.

President Biden indicated in his letter that a pay rise is essential to maintaining the federal government’s competitiveness as an employer, particularly as inflation remains above the Federal Reserve’s two percent target.

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Federal Employees in Line for Largest Pay Hike in 40 Years

“We must attract, recruit, and retain a skilled workforce with fair compensation to keep our government operating, provide services, and meet our nation’s current and future challenges. This alternative pay plan decision will continue to enable the Federal Government to employ a wellqualified Federal workforce on behalf of the American people, while maintaining pace with prior wage growth in the labour market,” wrote President Biden.

Unless Congress enacts a different pay plan for 2024, the increase will be implemented.

However, some members of Congress and federal employee organisations demanded a larger pay increase. Sponsored by Representative Gerry Connolly (D-VA) and Senator Brian Schatz (D-HI), the Federal Adjustment of Income Rates (FAIR) Act proposed an average increase of 8.7 percent.

Representative Connolly issued the following statement: “While not exactly what Senator Schatz and I requested in our FAIR Act, a 5.2 percent average pay rise is the highest since the Carter Administration and will help us recruit and retain the federal workforce of tomorrow.”

Federal employee organisations also praised the salary increase as a positive beginning.

“Frontline federal employees earn 24.09 percent less than comparable private sector workers… National Treasury Employees Union (NTEU) National President Doreen Greenwald said in a statement to Federal News Network that Biden’s plan would help reduce the deficit and make federal employment more competitive.