Why Federal Pay Needs Fixing: The Governmentā€™s Own Numbers on the Pay Gap
The case for a federal pay raise is getting louder now that unions are pushing the new Congress to act, and some of the strongest arguments come from the government’s own numbers. Accountability and correcting what is broken are not mutually exclusive, and the data suggests federal pay is one of the things that needs correcting. Here is the case, one number at a time.
A 1990 Standard That Was Never Fully Implemented
In 1990, Congress said federal pay should sit within five percent of private-sector pay. That standard was never fully implemented under either party. The government’s own count of the gap today, from the Federal Salary Council, is 24.72 percent.
What About the Benefits?
Benefits are the usual answer to the pay gap, but the numbers there are not as reassuring as they sound. The Congressional Budget Office (CBO) puts federal wages about ten percent below the private sector, and for doctors, lawyers, and scientists the gap is 29 percent, according to its April 2024 federal-private compensation report. Meanwhile, your share of health premiums is up more than 40 percent in three years.
Raises of Two Percent, One Percent, and Now Zero
Recent raises have been two percent and then one percent, and the proposal for 2027 is zero. A freeze is effectively a pay cut. The president’s own August 26, 2026 alternative pay plan letter acknowledges that the pay formula called for 3.1 percent plus 20.6 percent in locality pay. The proposal sets it at zero.
Job Security Was the Trade-Off
CBO has said job security is part of what allows the government to pay less. Then came 2025, with reductions in force, probationary firings, and 317,000 people gone. The argument is that the government cannot take away the security and keep the discount.
The Recruiting Problem
OPM has said it wants to bring in younger workers, but about seven percent of federal employees are under thirty, compared with twenty-two percent of the workforce elsewhere. Hiring talent at a discount is difficult, and the likely result is vacancies.
What Happens Next
Nothing is final until Congress and OPM act, and no one can say for certain that a raise will happen. Reporting from Government Executive (“Post-midterms, federal unions push for pay raise, restoration of bargaining rights,” Erich Wagner, November 4, 2026) describes the unions’ push, and the fight is expected to play out in the fiscal 2027 spending legislation, which must pass before the current continuing resolution expires December 11. Options on the table include the FAIR Act’s 4.1 percent, the 3.8 percent proposed for law enforcement officers, and finally funding the 1990 law.
The figures above come from the CBO’s April 2024 federal-private compensation report, the Federal Salary Council’s 24.72 percent figure, OPM’s FEHB rate announcements, and the president’s August 26, 2026 alternative pay plan letter.
The Bottom Line
Should Congress fix federal pay, and if so, how? We would like to hear what you think. To keep up with developments like this one, sign up for our free newsletter.
Legal Disclaimer: This content is for general informational purposes only and does not constitute legal advice. Federal employment situations are fact-specific and time-sensitive. Please consult a qualified federal employment attorney about your specific situation. You can contact Southworth PC at attorneysforfederalemployees.com.