Really? A one percent pay raise?


REUTERS/Kevin Lamarque

When President Obama releases his 2015 budget next Tuesday, he will propose another one percent pay raise for federal workers. The increase will be the second consecutive year that government employees have seen a one percent boost, following sequester cuts, furloughs and three years of across-the-board salary freezes before that. "This modest pay increase will help the government remain competitive in attracting and retaining the nation's best and brightest individuals for public service," an unnamed government official said in a statement.

A one percent uptick is better than nothing. And sure, some federal employees' compensation has risen in other ways. But let's be honest about something: A one percent increase is not really going to do much to keep the government competitive or to retain great employees.

For context, consider what private-sector employers said they plan to give their workers in 2014. A survey of 910 U.S. companies by the consulting firm Towers Watson found that the average corporate employer was planning a 2.9 percent increase for 2014, nearly three times what the government offered its workers this year. And that follows similar increases for each of the past three years, when salaries for government workers were frozen.

Moreover, the best and brightest at those private companies are getting far more than the average 2.9 percent increases. As Corporate America increasingly differentiates its pay schemes, star performers are seeing pay hikes that are 75 percent higher than average workers see, reported Towers Watson. Employees with the top performance ratings saw 4.6 percent increases in 2013, the firm said, and those working in in-demand fields such as technology received even more of a pay bump.

Granted, comparing public employees' pay to that of professionals in the private sector is a tricky exercise. There has been endless debate over whether federal workers are overpaid or under-compensated. And some government workers have seen money come their way in other forms — whether promotions, performance awards or step increases within their job categories. The "average" federal worker's salary in 2013 actually rose despite the pay freeze.

Here's the thing: No employee looks at a one percent increase and thinks "that extra $25 in my biweekly paycheck is going to keep me from jumping ship to a corporate job." The financial boost that such a small increase offers might even be cancelled out by the emotional grudge that it wasn't higher. At the same time, few star federal workers with critical job skills would look at a private-sector job that offers 5 percent more and jump for the money alone.

Staying competitive means creating career paths where people can grow and advance. It means offering the most valuable employees noticeable, tangible increases that — even if they don't quite keep pace with the private sector — reflect the worth of their skills and their performance. And it means putting in place the kind of resources, managers and meaning that help government staffers feel their work is respected and valued at a time when it is being criticized more than ever.

So let's call this one percent increase what it is. It's a way to help employees deal with the costs of daily living. To stay competitive, and to attract and retain the best and brightest, will take a lot more.

Jena McGregor is a columnist for On Leadership.

Read also:

Managing a "victimized" federal workforce

Few bright spots in sad survey of federal employees

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Jena McGregor writes a daily column analyzing leadership in the news for the Washington Post’s On Leadership section.
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Jena McGregor | February 25