Will Your 2007 Pay Raise be "Pulled" Up or "Pushed" Down?

By on July 21, 2006 in Current Events with 0 Comments

The push-pull economic theory attempts to explain supply and demand. An increase in demand raises the price of a product or service. As demand decreases, the price of the product or service goes down. The push-pull theory is also used in advertising and marketing. If there is no demand for a product, advertising may "push" the consumer to create a demand and to increase prices once the demand goes up.

The "push-pull" theory is apt in describing how the amount of federal employee pay raises have been decided in recent years.

For the past several years years, there have been cries for pay parity between military personnel and civilian employees. Congress usually approves larger raises for military personnel based on a combination of political appeal because of patriotism, the necessity to recruit more people to enlist and the need for higher wages to attract new soldiers because of the increasing fear of being injured or hurt in combat as the military became engaged in combat around the world.

Politicians with a large number of federal employees in their districts, such as Steny Hoyer of Maryland, can be counted on to bring out the theory each year. (See Dancing and Playing to the Crowd: Predictions for Your 2007 Pay Raise) Like most of us, if something works, we keep doing "it" until "it" stops working.

But here is a strange twist on your 2007 pay raise.

In past years, the miliitary has had a bigger pay raise approved by Congress than the amount proposed by the president for civilians. Because the military was getting a higher pay raise, the civilian raise was "pulled" higher as the pay parity argument was successfull in getting more money for the raises.

This year, due to the vagaries of legislation getting through Congress, civililans have had a larger pay raise approved than military personnel. As of now, it looks as though federal employees will be getting an average pay raise of 2.7%. In fact, the Senate Appropriations Committee has approved a 2.7 percent pay raise for the civil service for next year.

That doesn’t make the percentage a sure bet. Once again, there is disparity between what has been approved for military and civilian personnel. The twist is that, so far this year, the amount approved for military personnel in the Senate is 2.2%. 2.2% is also the amount of the pay raise recommended by the administration for both military and civilian personnel. (See Debating the Federal Pay Raise)

One thing is certain: those with an interest in the subject will be arguing that both military and civilian personnel should be getting the 2.7%. In other words, since a 2.7% pay raise has been approved for the civil service, this approval will be the argument in favor of pulling the military raise up to 2.7%.

Of course, under the "push-pull" theory of pay raises, a 2.2% pay raise for military personnel could also pull down the amount to be given to the civilian workforce. In fact, the Washington Post reports that manager of the Senate bill containing the civil service raise has already relayed the message that given the difference with the proposed military raise, senators might be asked to "bring civilian pay down to that level."

Of course, no one knows whether the final figure will be because the civil service "pushed" up the amount for the military or whether the raise for the civil service will be "pulled" down by the amount approved for the mllitary.

© 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.