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Pay Agent has ‘major’ issues with pay gap methodology

The President’s Pay Agent in its annual report on federal employee salaries and compensation, said it has “major methodological concerns” with how the Federal Salary Council calculates the pay disparity between federal employees and the private sector workers.

According to the report, the value of employee benefits is not included in the pay comparison, and the comparison also does not reflect the reality of labor market shortages and excesses.

Last April, the council found that private-sector workers are paid, on average, 32 percent more than federal employees in similar occupations.

The Pay Agent notes that a recent report by the Congressional Budget Office finds the pay gap to be 17 percent in favor of federal employees, accounting for an average 47 percent higher benefits package than the private sector and 3 percent higher wages.

“While we recognize that the methodologies used by CBO and the Federal Salary Council differ, and that the current locality pay methodology allows the Pay Agent to make distinctions in GS pay levels on a singular geographic basis for each locality pay area, we find the overall scale of the pay disparities presented to us each year using the current locality pay methodology lacks credibility,” the report states.

“We strongly encourage the Council to thoroughly assess the methodology and identify strengths, weaknesses, and areas for improvement,” it added, continuing, “We look forward to seeing the Council’s findings and further recommendations for improvement.”

View the full report here.

Reader comments

Tue, Mar 19, 2019

The standard should be the federal sector, not the private sector - we all know a lot of the private sector treats employees less favorably. They should be talking about how to improve private sector compensation instead of talking about how some make more in the fed. Not to mention my position has incredibly more liability and responsibilities than it would if I were in the private sector. It would not be legal for some of us to perform what we perform if we were held to our state's regulations.

Thu, Mar 7, 2019

No matter what method is used it is similar to the federal employees view point surveys, where it has been found that deficient egocentric minion managers are responsible for the poor morale of hard working employees. They do nothing about it and allowing management to keep up the destructive morale breaking activities rather than removing them from their positions. The pay agent is deficient since no one ever benefits because we have inept congress and senate along with political appointees (both republicans and democrats) who have no concern about the needs of the federal work force.

Mon, Mar 4, 2019 Irene texas

The federal pay system is insane. You could be a GS 6, step 10, and be the best worker in the history of the world and never see a pay increase. A 1.9% pay raise doesn't even pay for the increased cost of most people's health insurance. Meanwhile, private companies have no problem handing out $10K bonuses to employees who I guarantee you, in some cases, are subpar workers.

Wed, Feb 27, 2019

Of course the president disagrees, the result is not the answer that he wants to hear.

Tue, Feb 26, 2019

At the big outfit in Bethesda, management takes care of management by issuing bogus bonuses; stagnating employees so there is no chance of promotion by spewing deceit that a position series does not have higher grades when in fact the OPM guidelines specify higher grade options. Also if you are in the social clique of the management and are drinking buddies then your chances for promotion exist at the expense of other hard working productive employees. Purge management and allow true merit which would benefit employees.

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Edward A. Zurndorfer Certified Financial Planner
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Mathew B. Tully Legal Analyst

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