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Military vs. Civilian Pay

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You can often tell a military service member from a civilian by Navy blues or cargo pants, but discerning the difference in their pay and benefits is decidedly more difficult.

Labor unions representing federal employees are disappointed with President Obama’s fiscal 2013 proposal to end the two-year civilian pay freeze that began in 2011, since the suggested raise of 0.5 percent is negated by another proposal to increase the amount employees must contribute to their pensions by 0.4 percent annually for three years, beginning in 2013.

The American Federation of Government Employees called the increase in pension contributions a “sop to the right wing” after Monday’s budget release: “The GOP has insisted on huge federal retirement cuts in the highway bill and payroll tax conference, and this only serves to fan the flames,” John Gage, AFGE president, said Monday.

The Federal Management Association decided to take the criticism a step further, comparing the civilian deal to the administration’s proposed 1.7 percent increase to basic military pay in 2013. Labor union groups have urged a return to pay parity between military and civilian workers since former President George W. Bush ended equal pay raises, breaking with longtime precedent.

This point of contention is nothing new, FMA Executive Director Todd Wells told Government Executive.

“For decades that was the norm, before the pay freeze and before the economy went south,” Wells said. “Pay parity was pretty much a given. No one can argue that it’s unfair.”

FMA says a lack of pay parity is particularly unfair to civilians who work alongside military members overseas and at Defense Department installations in the United States.

The group doesn’t mention that military pay – or at least raises -- also are up for a modest hit in the fiscal 2013 budget proposal, which suggested slowing active-duty pay raises in coming years.

It turns out that comparing total compensation between service members and civilians is no simple task. The Government Accountability Office’s most recent assessment found that broad military compensation for active-duty officers and enlisted personnel is difficult to measure and this discourages a more comprehensive comparison of military versus civilian pay and benefits. When GAO compared compensation solely on the basis of pay in 2010, the findings aligned with FMA’s argument that civilians aren’t getting as good a deal.

The two studies GAO analyzed -- a 2007 Congressional Budget Office report and a 2008 Defense-commissioned CNA Corp. report -- both found that military pay “compares favorably” with civilian pay.

Further, GAO’s attempts to overcome the complications of comparison conclude with military pay and benefits on top.

The CNA study found that “the inclusion of three military benefits -- health care, retirement and the additional tax advantage for military members -- increased the differentials by an average of $8,660 annually for enlisted service members and $13,370 annually for officers.”

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