New figures from the Federal Salary Council show that the federal-private sector pay gap has fallen to 23.11 percent, continuing a seven-year trend in which the number has decreased each year from 35.4 percent.
The number is the official—although controversial—measure of how federal and non-federal salaries compare, for purposes of the GS locality pay system. Under a 1990 law locality pay sufficient to close the varying gaps by metro areas was supposed to have been paid by now. That hasn’t happened for reasons including the cost and disagreements over the methods used to compare salaries.
Instead, the measures of pay gaps by city areas are used mainly to divide up the portion of an annual raise that is designated as locality pay among the areas with their own rates and a catchall “rest of the U.S.” locality for areas outside those zones (Alaska and Hawaii also have specific rates covering the entirety of those states).
For 2021, the most likely federal raise will be the 1 percent, to be paid across the board with no differences by locality, that President Trump has recommended to take effect by default if no other figure is enacted into law before the end of this year. A House-passed spending bill would allow that raise by taking no position, while the Senate has not drafted a counterpart.
The administration recently finalized rules to create a new locality effective in January for the Des Moines, Iowa, area and to add Imperial County, Calif., to the Los Angeles area, in total moving some 5,000 employees from the lowest-paid locality, the catchall “rest of the U.S.” The salary council is continuing to consider other areas for possible creation as new localities and further potential boundary changes.