Federal employees earn on average 26.71 percent less than private sector counterparts, according to research released by the Federal Salary Council Nov. 5, a slightly smaller divide than the 31.8 percent difference the same study found in April 2018.
“The pay gap is real, and it has having real consequences in cities and towns across America,” National Treasury Employees Union National President and council member Tony Reardon said in a news release.
“Important federal jobs go unfilled because skilled workers can make more money in the private sector, which hurts the government’s ability to serve taxpayers.”
Despite the significant gap reported by the Federal Salary Council, whether or not federal employees actually see a pay disparity with the private sector is an issue that has caused intense debate, as an April 2017 Congressional Budget Office study noted that feds with a high school diploma make 34 percent more than their private sector counterparts.
The Trump administration has used the CBO study to justify proposals to freeze federal pay both in 2019 and 2020.
The discrepancy in whether feds make more or less than the private sector may come down to how each study is conducted.
The Federal Salary Council estimate is produced by taking a random sampling of private-sector positions in a given area and comparing them with similar positions on the GS scale. The process, in theory, replicates what a federal employee could expect to make should they choose to take a private-sector job in the same location and with the same skills requirements.
The CBO study, on the other hand, relies on comparisons of education level, rather than job descriptions.
Determining the true gap also gets more complicated when factoring in locality pay — which is offered to offset costs for feds that live in expensive areas — and government benefits.
But, according to agency representatives that spoke at the Federal Salary Council’s Nov. 5 hearing, medical and other high-skill positions in the government are remaining empty because agencies are not able to match the high salaries that the private sector offers in cities such as Charleston, South Carolina, or Atlantic City, New Jersey.
President Donald Trump relented from his position of freezing federal pay entirely for 2020 to agreeing to a 2.6 percent across-the-board increase for basic pay. That increase would not impact locality pay, which Trump said would cost the government $24 billion in one year if it were brought up to the level that the standard equation for yearly adjustments requires.
In its 2020 appropriations legislation, the House pushed for a .5 percent increase for locality pay, in line with the adjustment for 2019.
“Approving a 3.1 percent pay raise and adding more locality pay areas is not going to close the gap or make federal employees rich, but it is going to help people afford to take care of their families and serve their country, doing work that is crucial to our security, our economy and our public health,” Reardon said.