President Joe Biden on Wednesday announced plans to give federal civilian employees a pay raise in 2023. The president said there would be an overall average pay increase of 4.6% for civilian federal employees to take effect on January 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 in a letter to House Speaker Nancy Pelosi (D-Calif.).
Biden cited recruitment and retention challenges for federal positions as to why the proposed raise is needed. The new pay plan, he added, would allow the federal government’s pay to stay competitive with what workers with critical skills could earn in the private sector.
“Federal agencies have witnessed growing recruitment and retention challenges with federal positions experiencing eroded compensation. 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 skill sets, which requires keeping Federal pay competitive,” the president added.
Federal employees received a 2.7% average pay raise in 2022.
The newly announced 4.6% pay raise is an average for the civilian federal workforce, meaning that depending on where they work, some employees may receive slightly more based on their locality pay area and, in some cases, may see a slightly lower pay rate.
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.
The average 4.6% raise would be the largest for civilian federal employees since a pay boost of that same percentage was enacted in 2002. Two years earlier, civilian federal employees had received an average 4.8% raise.
Still, the president announcing the pay increases does not set it in stone. Congress could enact a different rate of pay increase for 2023, and that would take precedence over Biden’s.
If Congress does not specify a rate of pay increase, Biden’s numbers take effect automatically. It is expected that the Democratic-controlled Congress will be unlikely to push for rates lower than Biden’s.
However, they could push for a higher rate of pay increase.
Tony Reardon, president of the National Treasury Employees Union, said the average 4.6% increase would “go a long way toward helping recruit and retain the public servants our government needs.”
Still, he said his union would continue to push Congress for a 5.1% average increase that some Democrats have proposed.
“We will continue to urge Congress and the administration to consider changing economic conditions and the 22.47% pay gap between federal employees and their private sector counterparts before making any final decisions on the 2023 federal pay increase,” Reardon said.