New figures from the Federal Salary Council show that the federal-private sector pay gap has narrowed a bit, to 30.91 percent, down from the 31.86 percent reported in the spring and the 34.07 percent in the prior accounting in late 2016.
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.
However, as a practical matter, pay has become one more thing negotiated annually between the White House and Congress. 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 2019, federal workers almost certainly will either have a salary rate freeze or an average 1.9 percent raise, which would be divided as 1.4 percent paid across the board and 0.5 percentage points for locality pay, likely producing raises ranging from about 1.6 to about 2.3 percent. That decision likely won’t be made until early December, as part of an appropriations measure still pending in Congress.
Meanwhile, the salary council continued to support the addition of at least four, and potentially six, new localities effective in January. Rules were proposed earlier this year to create localities in the Birmingham, Ala., Burlington, Vt., San Antonio, and Virginia Beach, Va., areas—and to add McKinley County, N.M., to the Albuquerque locality and San Luis Obispo County, Calif., to the Los Angeles area. The council also previously recommended new localities for the Corpus Christi and Omaha areas, although the proposed rules didn’t include them. It is possible that they will be added when the rules are finalized, which could occur at any time.
Currently there are 44 city areas. When a new locality is created, or an area added to an existing one, employees working in those areas are moved out of the “rest of the U.S.” locality, the lowest-paid, and receive an immediate salary boost as well as slightly larger annual locality raises moving forward.