Feds Make 32 Percent Less than Private Sector Counterparts, Salary Council Says

The Federal Salary Council recommends six new locality pay areas for 2019 in the group's first meeting since 2016.

Federal employees on average earn 31.86 percent less than their counterparts in non-federal jobs, said an advisory council on compensation issues Tuesday.

The Federal Salary Council, a group of compensation experts and union officials that issues recommendations to the Presidential Pay Agent, made the determination based on data from the Bureau of Labor Statistics. The new figure is slightly smaller than the council’s previous calculation, which estimated federal workers made around 34 percent less, on average, than people in the private sector.

The figure was announced during the council’s first meeting since 2016, at which the group recommended adding six new locality pay areas—regions where the high cost of living warrants paying federal workers more than the government-wide base pay—for 2019. Of those, four regions previously were recommended by FSC and approved by the Presidential Pay Agent and are in the rule-making process.

The council voted to submit the areas of Corpus Christi, Texas, and Omaha, Nebraska, to the pay agent for approval and inclusion in the rulemaking process for 2019 locality pay areas. Already on the docket for rulemaking are Birmingham, Alabama; Burlington, Vermont; San Antonio, Texas; and Virginia Beach and Norfolk, Virginia.

Comparisons between federal and private sector compensation are fraught with controversy. Although Democrats and federal employee groups tend to cite FSC and BLS data, Republicans frequently point to calculations by the Congressional Budget Office, which uses a different methodology and found last year that feds made 17 percent more than those in the private sector from 2011 through 2015.

The council, which is now chaired by veteran federal personnel official and Trump administration appointee Ron Sanders, also agreed to re-examine how it determines whether to add new regions to the list of locality pay areas.

But the White House’s plan to institute a pay freeze for all civilian federal workers in 2019 cast a pall over Tuesday’s proceedings. National Treasury Employees Union National President Tony Reardon said Wednesday that the negative impact of the freeze, along with a host of proposed cuts to federal employee retirement programs, would vastly outweigh any effort to improve some feds’ compensation through locality pay.

“The expansion of locality pay areas doesn’t mean much if the administration intends to freeze salaries in 2019, as proposed in its budget,” Reardon said. “A pay freeze, coupled with the fact that private sector workers earn on average about 32 percent more than their counterparts in the federal government, only puts the U.S. government further behind in the competition for highly-skilled workers.”