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4.6% Raise for Federal Workers Proposed by Biden for 2023

This week, President Biden put forth a budget proposal that is set to grant civilian employees an average pay increase of 4.6%. This is in alignment to be the largest annual pay raise for federal workers in 20 years.  

Comparing this figure to the 2.7% average pay increase of 2022, it is nearly double, and also proves to be a significant improvement over the 1.0% across-the-board pay increase feds saw in 2021.  

Budget documents released by the White House said that the pay raise is part of a larger effort to improve the effectiveness and equity of the federal government. The documents lack specification on the subject of just how the figure will be distributed between the increases in basic pay and average boosts to locality pay. Typically, 0.5% of the overall figure is separated and saved for locality pay. The 2023 budget proposal does however definitively set a 4.6% pay increase for Military service members. 

“These efforts will help agencies retain qualified employees, empower workers to make their agencies better, create a pipeline of qualified leaders, and provide better services to the public,” the White House stated. “The budget supports these objectives by ensuring that all those in federal jobs earn at least $15 per hour and providing a pay increase of 4.6% for civilian and military personnel.” 

For years, federal employee groups had to fight tooth and nail for sizeable pay raises, as the Trump administration’s budgets pushed for pay freezes and cuts to non-salary benefits, while agencies underwent sequestration in the Obama administration. Biden’s fiscal 2023 budget includes no major proposals related to federal workers’ health care or retirement benefits. 

The last time federal employees received a pay raise of this magnitude was in 2002 during the George W. Bush administration. The 2023 figure comes in light of months of high inflation sweeping the American economy. 

Rep. Gerry Connolly, D-Va., and Sen. Brian Schatz, D-Hawaii, had created legislation that wanted to provide federal workers an average 5.1% pay raise in 2023. That plan hoped to split a 4.1% across-the-board pay increase and a 1% average increase in locality pay. 

While Connolly’s proposal did not reach actualization, he still praised Biden’s budget proposal in a statement. 

“With this budget, President Biden again makes clear that his commitment to the federal workforce is ironclad,” Connolly said. “This would be the largest pay increase for federal workers in decades, and it would be critical to our efforts to attract and retain the next generation of federal employees.” 

Additionally, National Treasury Employees Union National President Tony Reardon called Biden’s pay raise proposal a “great starting point,” but made sure to state that his union still prefers Connolly’s 5.1% raise plan. 

“The White House proposal to give federal employees an average 4.6% pay increase in 2023 makes clear that this administration understands that improving salaries will help attract and retain highly skilled workers around the country, a sentiment that NTEU strongly supports,” he said. “That said, NTEU has already endorsed the Federal Adjustment of Income Rates Act calling for an average 5.1% pay adjustment for federal workers next year . . . Over the years, federal pay increases have barely kept up with inflation, and the average pay disparity between the federal government and the private sector, according to the last report by the Federal Salary Council, is 23.11%.” 

Lastly, Ken Thomas, president of the National Active and Retired Federal Employees Association, backed Biden’s proposal more fervently. 

“With the 4.6% average federal pay increase proposed for 2023, Biden demonstrates appreciation for the millions of hardworking public servants who keep the government running day after day,” Thomas said. “If enacted, the 4.6% average pay increase would be the largest since 2002. The amount tracks with recent increases in private-sector pay and the expected military pay increase for the second consecutive year. Keeping up with private-sector pay growth is essential to maintaining the federal government’s ability to recruit and retain a highly qualified and effective workforce.” 

In order to keep up with changes in policy pertaining to the federal workforce, be sure to visit the Federal News Bulletin for weekly articles. If you want to go a step further and utilize Federal Benefits Service’s premium retirement content, such as the TSP Market Watch, which offers allocation recommendations by a licensed professional, become a member today.  



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