'04 pay increase awaits Bush signature
November 16, 2003
ARLINGTON, Va. — It’s just the stroke of a pen away: When President Bush signs the defense authorization bill, everyone in uniform will get at least a 3.7 percent raise in January — enough to keep pace with their private-sector peers plus a half-point extra, for good measure.
And thanks to targeted raises of as much as 6.25 percent for midcareer noncommissioned officers and warrant officers, the average raise next year will be 4.15 percent. Bush will probably sign the authorization this week, a White House official said, but a precise date has not been set.
The targeted raises, which center around enlisted grades E-5 to E-9, date back to 1999, when when military retention began to tank.
Part of the problem, defense officials found, was low salaries.
Using civilian salary data provided by the government’s Bureau of Labor Statistics, Pentagon officials put military and civilian salaries side by side. What they found was a significant gap between the two that was especially wide for senior enlisted members, a defense compensation official said Friday.
It’s not possible to perfectly equate civilian job experience with military experience, but two measures are helpful, the official said: years of experience and education levels.
In the civilian world, the more education a worker has, the more money he or she earns.
In the increasingly technical military, enlisted members who want to be promoted often seek college degrees, as well.
“Today, by the time [members] are NCOs, more than half have at least some college,” the official said, whether that means a few credits picked up in correspondence class or a full-fledged degree.
But that college was not paying off in higher salaries, the official said.
“What we found was the more senior enlisted members and warrant officers are competitive with people from the outside who have some college, but their [civilian] contemporaries get more money,” the official said.
Working with Congress, defense officials set a goal: to make sure servicemembers in every grade match or exceed the 70th percentile of salaries as averaged for the civilian sector.
To help with that goal, in 1999 Congress passed a bill that links military salaries to the U.S. government’s Employment Cost Index, or ECI, which is a measure of how much wages and salaries of the civilian workforce have grown over time. Congress mandated that all annual military raises must be at least ECI plus half a percentage point each year from 2000 to 2006.
Now, after three consecutive years of targeted military raises that were never less than 3.7 percent for anyone in uniform — and often much more — the gap between military and civilian wages has narrowed significantly, the compensation official said.
Moreover, because “there’s a lot invested” in training as the NCOs progress in their careers, Pentagon officials have a vested interest in retaining the experienced cadre, rather than go through the expense of training a new group to replace them, the official said.
“That isn’t to say we wouldn’t pay more to everyone, if we could,” the official said. But with limited funds for raises, “we’re putting the targets right on the gap, so we can close it.”