Locality Pay Areas Grow and Expand
FedSmith has provided a series of articles on federal employee locality pay over the last few years, including how fast the system has grown and its impact on federal salaries. For example, this 2024 article stated:
Since 2015, the number of locality pay areas has gone from 33 to 57, a 62.7% increase. This includes the four new areas designated as locality pay areas in 2024.
While the number of new locality pay areas is impressive, the actual increase is larger than it first appears. For example, in 2024, while four new locality pay areas were added to the pay system, the actual number of federal employees added was about 33,000. This is because some federal employees were added into existing locality pay areas rather than going into a new one.
A new report entitled Mapping the Swamp published by Open the Books uses publicly released data on federal salaries for fiscal year 2024. While the locality pay system does not receive significant publicity in the national press, it operates largely out of public view, providing pay raises through an internal bureaucratic system that determines federal employee salaries by geographic area.
Locality Pay and Telework
As locality pay has now encompassed most of the federal workforce, average salaries have grown substantially. The latest report includes federal employee raises including the 2024 raise of 5.2% which was the highest pay raise in 40 years.
In addition to the increasing coverage of locality work for the federal workforce, the expansion of telework under the Biden administration overlapped with the growing number of employees in locality pay areas.
Senator Joni Ernst has focused on this issue.
With a growing number of federal employees “teleworking”, some were able to live in a rural area with lower expenses, often far outside the central city in a locality pay area, and still receive the higher pay scale of that locality. While commuting from these rural areas is not practical, if the home is in a low-cost area, but the low-cost area has been added to a high-paying locality area by the Federal Salary Council and the President’s Pay Agent, a federal employee effectively receives a higher salary under the locality pay system.
As locality pay has now encompassed most of the federal workforce, average salaries have grown substantially. The latest report includes federal employee raises including the 2024 raise of 5.2% which was the highest pay raise in 40 years.
While the report covers fiscal year 2024, the salary increases have continued. At the end of March 2025, the latest available data, the average salary for the federal workforce (weighted by the number of employees in each age group) was about $109,879 across 2,289,472 employees.
Blunt Conclusion
The new report lays out a blunt conclusion: the federal workforce became dramatically more expensive during the Biden years, even though the number of federal employees barely grew. Payroll costs climbed sharply, driven primarily by salary inflation at the upper end of the pay scale.
A number of agencies are very small and probably unknown even to many in the federal workforce. Most of these obscure agencies have fewer than 1,000 employees, and many have fewer than 100.
Payroll Up 24% Since 2020—Headcount Up 5%
The report shows that the civilian federal workforce (excluding DOD and Postal Service) reached roughly 2.9 million employees and had a disclosed payroll of $270 billion in FY 2024. That’s a 24% jump from FY 2020, when payroll stood near $217 billion. The size of the federal workforce grew by about 5% during that period.
In short, federal workplace growth was modest; salary growth for federal pay was not.
When estimated benefits are added (Open the Books uses a 30% estimate), total compensation for the federal workforce now comes to around $351 billion.
The Surge in Six-Figure Jobs
The biggest change is not in hiring. It is the compensation structure. The number of employees earning six-figure salaries has exploded since 2020.
- Federal workers earning $100,000+ jumped 49%
- Those earning $200,000+ soared 82%
- The number above $300,000 rose 84%
In 117 of 127 major agencies (and in the White House as well), the average salary at the time the data were calculated exceeded $100,000. As noted above, OPM data as of March 2025 showed an average federal salary of almost $110,000.
The report highlights a striking trend in the federal workforce: the number of highly compensated federal employees has grown significantly. The report highlights several items, including the highest federal salaries.
In FY 2024, 956 federal employees made more than the President of the United States, who has had a salary of $400,000 since 2001. There are more employees earning more than $400,000 than ever before in Open The Books’ payroll records dating back to 2010. 939 of the employees who out earned the president were medical officers at the Veterans Health Administration. Four of the employees listed are dentists.
15 doctors at the National Institutes of Health earn more than $400,000, including the four highest-paid employees in the entire federal workforce. The director of the National Heart, Lung, and Blood Institute was paid $519,246, breaking his own record for the highest federal salary in American history. Dr. Anthony Fauci, who was the federal employee of the year in 2020, once held the record for being the highest-paid federal employee with a $480,654 salary in 2022.
An additional 36 federal employees earned exactly $400,000, the same salary as the president. A few years ago, it was rare for any federal employee to earn more than the president. In 2019, only three federal employees made more than $400,000.
Why Federal Pay Has Gone Up
The report points to several forces behind the spike in federal pay in the last few years.
1. Steady annual pay raises
Federal employees received yearly across-the-board increases under Biden, plus higher locality adjustments in many metropolitan areas. Even relatively routine annual bumps compound quickly across a workforce of nearly three million.
As noted in this FedSmith article, annual pay raises were not unique to the Biden administration. While the raises were higher under President Biden, as inflation went to its highest level in decades, annual raises are commonplace.
2. Locality pay expansion
Locality areas expanded and rates rose—particularly in major metro zones—pushing a significant portion of base salaries above the six-figure threshold.
3. Higher-paid roles expanding faster than lower-paid jobs
Agencies hired more professionals in law, finance, tech, science, regulatory analysis, and management—positions that naturally command higher salaries. In other words, the federal workforce shifted toward higher-paying jobs and higher costs.
4. Retention pressure for specialized talent
Agencies argue they must raise compensation to compete with the private sector, particularly for cybersecurity, IT modernization, healthcare analysis, and financial regulation.
Open the Books also pointed out the increasing difficulty in obtaining information on federal employee salaries. Its latest report also highlights a growing blackout in disclosing federal salaries.
The redactions are concentrated in law enforcement, intelligence, diplomatic, and investigative agencies. Roughly 383,000 names—representing $38 billion in pay throughout 58 agencies—were redacted from public records in FY 2024.
According to the report, at the midpoint of the Obama administration, only 2,300 names were redacted from the payroll produced by the Office of Personnel Management.
The result of this is a federal workforce that is increasingly expensive and less publicly transparent than in previous years.
Here are the agencies with the highest average salary:
| Agency | Average Pay | Staff Number |
| Commodity Futures Trading Commission | $236,006 | 721 |
| Securities and Exchange Commission | $213,869 | 4,843 |
| Ofc. of Intellectual Property | $195,000 | 2 |
| Public Buildings Reform Board | $191,899 | 7 |
| Arctic Research Commission | $191,724 | 2 |
| Consumer Financial Protection Bureau | $187,120 | 1,851 |
