thedrifter
07-31-07, 03:04 PM
Pay raise may not catch up to pay gap
By Rick Maze - Staff writer
Posted : Tuesday Jul 31, 2007 14:38:07 EDT
The 3.5 percent military pay raise working its way through Congress may not even be felt when service members receive it in January.
As tentatively approved by the House and Senate, the 2008 raise is supposed to shave half a percentage point off the estimated 3.9 percent gap between average military and civilian pay. But because of the 15-month lag in writing and passing the budget, service members are more likely to compare their Jan. 1 increase to current civilian wages. On Tuesday, the Labor Department’s Bureau of Labor Statistics reported that private-sector salaries are rising at an annual rate of about 3.4 percent, almost equal to the pending military raise.
The long approval process for the pay raise, which can make it easy to forget what the annual adjustment is supposed to be matching, results from the Bush administration’ submission of a budget about one year before the raise takes effect. The pay increase in the budget is based on a comparison of military and private-sector pay calculated in October, three months before the budget is submitted to Congress.
The Bush administration has been fighting a losing battle against the 3.5 percent military raise, pushing its smaller 3 percent increase as large enough to keep pace with average private-sector pay increases in 2006. A 3 percent raise would match the increase in the 2006 Employment Cost Index, a measure of civilian wages that under federal law is used to calculate both military and federal civilian pay raises.
Military pay may look better in terms of purchasing power. The price of goods and services is increasing at an annual rate of about 2.7 percent, the Labor Department reported July 18.
By week’s end, the House of Representatives is expected to pass the 2008 defense appropriations bill that includes $2.2 billion to cover the cost of the 3.5 percent raise.
The Senate passed the 3.5 percent raise last week as part of the Wounded Warrior Act. The House of Representatives approved a 3.5 percent raise for 2008 in May as part of the defense authorization bill and is expected to approve the $2.2 billion budget needed to pay for the raise this week when it passes the 2008 defense appropriations bill.
Ellie
By Rick Maze - Staff writer
Posted : Tuesday Jul 31, 2007 14:38:07 EDT
The 3.5 percent military pay raise working its way through Congress may not even be felt when service members receive it in January.
As tentatively approved by the House and Senate, the 2008 raise is supposed to shave half a percentage point off the estimated 3.9 percent gap between average military and civilian pay. But because of the 15-month lag in writing and passing the budget, service members are more likely to compare their Jan. 1 increase to current civilian wages. On Tuesday, the Labor Department’s Bureau of Labor Statistics reported that private-sector salaries are rising at an annual rate of about 3.4 percent, almost equal to the pending military raise.
The long approval process for the pay raise, which can make it easy to forget what the annual adjustment is supposed to be matching, results from the Bush administration’ submission of a budget about one year before the raise takes effect. The pay increase in the budget is based on a comparison of military and private-sector pay calculated in October, three months before the budget is submitted to Congress.
The Bush administration has been fighting a losing battle against the 3.5 percent military raise, pushing its smaller 3 percent increase as large enough to keep pace with average private-sector pay increases in 2006. A 3 percent raise would match the increase in the 2006 Employment Cost Index, a measure of civilian wages that under federal law is used to calculate both military and federal civilian pay raises.
Military pay may look better in terms of purchasing power. The price of goods and services is increasing at an annual rate of about 2.7 percent, the Labor Department reported July 18.
By week’s end, the House of Representatives is expected to pass the 2008 defense appropriations bill that includes $2.2 billion to cover the cost of the 3.5 percent raise.
The Senate passed the 3.5 percent raise last week as part of the Wounded Warrior Act. The House of Representatives approved a 3.5 percent raise for 2008 in May as part of the defense authorization bill and is expected to approve the $2.2 billion budget needed to pay for the raise this week when it passes the 2008 defense appropriations bill.
Ellie