Pay Raise for 2005 Moving Forward

By on December 1, 2004 in Current Events with 0 Comments

The federal bureaucracy usually moves slowly. But the 2005 pay raise for white collar federal employees is moving ahead.

In a letter to the Speaker of the House of Representatives and the President of the Senate, President Bush says “I am transmitting an alternative plan for the locality pay increase payable to civilian Federal employees covered by the General Schedule (GS) and certain other pay systems in January 2005.”

That’s the good news and it will please most readers who are looking forward to a raise in 2005.

Here’s the bad news: Under the pay comparability act, the raise could have been bigger.

As noted in the President’s letter: “For Federal employees covered by the GS locality pay system, the overall average pay increase would be about 13.1 percent….”

The problem is that most people outside of government don’t believe federal employees are underpaid under their current rates and certainly don’t think they need a 13.1 percent pay increase to equal private sector salaries.

We don’t know what the pay increase should be. But pay comparability is part art and part science–and with average salaries and many benefits already higher than the majority of voters who work for small businesses, holding down the salaries to 3.5 percent (or even 1.5 percent) does not create a political ripple through most of the electorate.

And, if federal jobs were paying 10 percent or more than comparable private sector jobs, one would think federal employees would be leaving their civil service jobs in droves. In reality though, federal employees are not leaving for private sector jobs that, in theory at least, pay a lot more money. The President’s letter states:

“This decision will not materially affect our ability to continue to attract and retain a quality Federal workforce. To the contrary, since the Congress has not funded the cost of a pay raise in excess of the 1.5 percent increase I proposed, agencies would have to absorb the additional cost and could have to freeze hiring in order to pay the higher rates. Moreover, GS quit rates are at an all-time low of 1.6 percent per year, well below the overall average quit rate in private enterprise. Should the need arise, the Government has many compensation tools, such as recruitment bonuses, retention allowances and special salary rates, to maintain the high quality workforce that serves our Nation so very well.”

So look at the bright side–the 2005 pay raise is moving forward and you will probably get it quicker than in the past couple of years.

© 2016 Ralph R. Smith. All rights reserved. This article may not be reproduced without express written consent from Ralph R. Smith.

About the Author

Ralph Smith has several decades of experience working with federal human resources issues. He has written extensively on a full range of human resources topics in books and newsletters and is a co-founder of two companies and several newsletters onĀ federal human resources.