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Biden announces plans to give pay raises to federal employees in 2023

President Biden stops to speak with reporters on Aug. 26 at the White House. (Demetrius Freeman/The Washington Post)

President Biden on Wednesday announced plans to give civilian federal employees a pay raise in 2023, consistent with the increases he had proposed in his 2023 budget.

In a letter to House Speaker Nancy Pelosi (D-Calif.), Biden said there would be an overall average increase of 4.6 percent for civilian federal employees to take effect Jan. 1.

“Specifically, I have determined that for 2023, the across-the-board base pay increase will be 4.1 percent and locality pay increases will average 0.5 percent, resulting in an overall average increase of 4.6 percent for civilian Federal employees,” Biden wrote.

He cited recruitment and retention challenges for federal positions as part of the reason for the proposed increases. The new pay plan, he added, would allow the federal government to better compete with the private sector.

“Multiple years of lower pay raises for Federal civilian employees than called for under regular law have resulted in a substantial pay gap for Federal employees compared to the private sector,” Biden wrote. “The American people rely on Federal agencies being managed and staffed by skilled, talented, and engaged employees, including those possessing critical skills sets, which requires keeping Federal pay competitive.”

The raise would apply to some 2.1 million executive branch employees, although not to the more than 600,000 employees of the U.S. Postal Service, whose raises are set through collective bargaining. Cost-of-living increases for federal retirees also are determined separately, reflecting the same inflation measure used for Social Security benefits.

The president’s announced pay increases are not set in stone. If Congress enacts different rates of pay increases for 2023, those numbers would take precedent over Biden’s. If Congress doesn’t specify any rates, Biden’s numbers take effect automatically. The Democratic-controlled Congress is unlikely to push for rates lower than Biden’s.

Tony Reardon, president of the National Treasury Employees Union, said the increase would “go a long way toward helping recruit and retain the public servants our government needs.” However, he said his union would continue to push Congress for the 5.1 percent average increase proposed by some Democrats.

Splitting the total into two parts would result in varying raises among some four dozen city areas with their own rates; a catchall rate applies elsewhere.

The Washington region, where about 15 percent of federal employees work, would be in line for one of the larger raises, according to a recent report by an advisory committee on federal pay. Exact figures would be set near year’s end.

An average 4.6 percent raise would be the largest since a boost of that same percentage was paid in 2002. Two years earlier, employees had received an average 4.8 percent raise.

Last year, Biden announced that civilian federal employees in 2022 would receive an across-the-board base pay increase of 2.2 percent and locality pay increases averaging 0.5 percent. Congress did not alter those figures.

Eric Yoder contributed to this report.