Pay to Rise 3 Percent

November 25, 1996

As expected, President Clinton announced late last week that he would implement a pay raise plan that would raise locality pay rates around the country 0.7 percent in 1997, making the total average raise next year 3 percent.

The President's announcement came in a letter to House and Senate leaders. Under the Federal Employees Pay Comparability Act of 1990, the President is required to inform Congress when he intends to implement an alternative to the full locality pay increases determined by nationwide comparisons of federal and nonfederal pay.

Permitting the full increases to take effect, wrote Clinton, would cause total federal pay rates to rise an average of 7.5 percent in 1997. That, he said, would cost $5.9 billion, $3.6 billion more than he had proposed in his fiscal 1997 budget for federal pay.

"Such an increase," wrote Clinton, "is inconsistent with the budget discipline my Administration has put in place . . ."

The pay reform law also requires the President to explain the likely affect of his pay-raise decisions on the government's ability to recruit and retain its employees.

"While I regret that our fiscal situation does not permit granting federal employees a higher locality pay increase," Clinton wrote, "I do not believe this will have any material impact on the quality of our workforce.

"Under the Federal Workforce Restructuring Act of 1994, and our efforts to reinvent federal programs, the number of federal employees is falling substantially. As a result, hiring and attrition are very low. In addition, as the need arises, the government can use many pay tools -- such as recruitment bonuses, retention allowances, and special salary rates -- to maintain the high quality workforce that serves our nation so well."

For detailed tables on locality pay rates in areas around the country, click here.

November 25, 1996