Alyssa Rosenberg writes at Government Executive that President Obama is not only limiting the 2010 pay raise for federal employees to 2 percent, he also plans to freeze locality pay rates at 2009 levels. The move makes Obama the first president in history to freeze locality pay rates.
Traditionally, locality pay rates are combined with an increase in base pay to make up the total raise that federal employees receive annually. But Obama's proposal would allocate the entire 2 percent pay raise proposal to employee's base pay. The move will help federal employees in areas where the overall pay gap between federal and private sector pay has shrunk, but could have a detrimental effect on areas where the pay gap has increased and the cost of living is high.
In a Nov. 30 letter to House Speaker Nancy Pelosi and Vice President Joe Biden, Obama contended that his pay plan should not increase the attrition rates of General Schedule employees. "The GS 'quit' rate continues to be very low (2.1 percent on an annual basis), well below the overall average 'quit' rate in private enterprise," he wrote.
What is your reaction to Obama's move to limit the pay raise and freeze locality pay in 2010? Is it a welcome move given the many challenges facing the nation and government, including the sluggish economy and rising unemployment? Is it possible that Obama's pay plan will increase the General Schedule quit rates, specifically among federal IT workers?
COMMENTS
I think that is a brilliant move for Obama's plan. Obama has just created more government jobs recently, although it is the private job sector that needs his powerful hand. Anyway, Obama now can spread the wealth and inflate Government Menagerie. Pay-reduced government job is than better no government and a vote for Obama assures one of their government job.
susan Tenofsky 12/22/09 03:11 am ET
I used to think Obama was for the working class but lately he has proven to be all corprate and big buisness.
Jason 12/13/09 04:05 am ET
Freezes on locality pay may seem good to some, but keep in mind these increases are based on increases from a CEI (Cost Evaluation Index), not the COLA as you are basing this on. I am in South Florida and I can tell you the cost of living has increased during 2009. Also, that locality raise in the beginning of 2009 was to keep up with the increase from the prior year 2008. So by laying this out in front you, we were always 365 days behind, and this years without a locality rate increase, 730 days behind, so in effect our money doesnot go as far as it did 365 days ago!
PS; the CEI does not take into account gas prices, or our home insurance increases we deal with with annually!
D.English 12/12/09 06:23 pm ET
If the Democratic legistators allow this to happen, I think the party will really suffer in the upcoming midterm elections. Federal employees will just stay home and not vote.
Chris 12/08/09 06:04 pm ET
I like the statement "Obama the first president in history to freeze locality pay rates" what a rip to get headlines! Locality Rates was introduced in 1994 under the Federal Employees Pay Comparability Act of 1990 (FEPCA) while Clinton was in office and there was only one other president before Obama.
Parris 12/07/09 12:27 pm ET
All those companies payed bonuses to their employees with the "Bail Out" and now we are supposed to sacrifice our pay because of that. There are many jobs in the private sector that I could have applied for but decided not to because I am prior military and would support our Gov't till the end. However, I don't know how long I will be able to stay with the Gov't if it continues to head in the direction it's heading.
Art Castro 12/07/09 10:08 am ET
There is a fundamental misunderstanding of economics and the role of government as employer by Obama. The federal government as slow as it can move sets an example for employers. This move is likely a great excuse for everyone to take a bigger hit in the comming year. This is not a moral issue and its not about the budget. Its a stunt. In reality a large increase could be the answer in this economy. If you pay less I spend less I save less and the only growth here is for bankers and insurance men. Basically cutting spending in this way will in a very direct way assist our slow economy to remain slow. Note to bankers your not smart your just getting a huge handout from uncle sugar and the fed.
John Briggs 12/06/09 11:55 am ET
I think the President should take a hard look at the pay, pay raises, and benefits that Congress enjoys and start making cuts there first.
Ann 12/04/09 12:10 pm ET
he already squeezes blood from a stone with those that already make sacrifices so why not put the screws to them even more. We already make sacrifices that he cannot even being fathom or care about, so why not make life a little more difficult for those who already make little money because they believe in their country. I am all for sacrificing for my country, but not when it is malicious and outright wrong. I think it is disgusting and cruel. Maybe he should suspend his pay for the rest of his term and kick in some of his own money to pay for his disaster.
furious government worker 12/04/09 07:34 am ET
This is another short sighted move by the president. I guess Obama wants federal employees to quit. Or maybe he is a Republican? So much for change.
Phil
Phil 12/03/09 05:52 pm ET
So this incompetent President (who I didn't vote for) gives our tax payer money to all these organizations, companies, industries, and then takes over our healthcare, transportation and banks, and increases our taxes (it's inevitable) to pay for all this and expects us to put food on the table, with what? Not to mention pay increasing costs with no pay raise which the Govt. is behind the private industry in salary pay anyway. Unelect the Elected. BTW, I can complain because I vote, work, pay taxes and stay educated on what is happening to America. I'll complain all I want - it's inevitable too.
mkh-l 12/03/09 05:15 pm ET
I think Mr. Obama should rethink this plan. We are already covering the bailout for the mistakes of others, we supporting spouses who have been laid off due to the fiasco on Wall Street, we are facing higher costs for basic utilities (gas, electricity, etc.) and he expects us to maintain all of this on our current salaries. He's proctected from all this while we foot the bill for his stay in the White House. Maybe we have the wrong man in the White House.
Barbara 12/03/09 10:05 am ET
I am happy to have a job! The President should keep in mind that regardless of locality pay and cost of living adjustments most Federal workers haven't seen a dime in the past eight years because of health care increases. Just one year ago my health care provider increased their cost by 100%. As a family I can just afford the premiums for insurance but we can no longer afford to use it because of the increase in co-pays. My health care provider will increase again this year by 9% (I am thankful for whatever increase I receive). We must find a way to regulate these costs.
Glutz 12/03/09 09:35 am ET
I wish Congress would just repeal FEPCA and get it over with. No President is ever going to follow it - Clinton even found some "emergency" excuse not to follow it when the budget was in surplus. This annual "here's why you're only getting 2-3%" farce is utterly pointless.
Little Birdie 12/03/09 08:08 am ET
Government employee's should not be punished for an administration that is more worried about increasing taxes and taxing the U.S. for carbon emissions (that will hurt the economy). Maybe the President should change his policies and stop spending money that we don't have. I wonder where the AFGE is now? I guess it was ok to use my dues to help elect.
Gerry 12/03/09 07:10 am ET
I appreciate the sentiment the President expressed, but the percentages he speaks of actually are the raises for Congress, and not the rest of the Federal general population. Normal Joe Feds such as myself have NEVER seen that type of pay increase, and in the best of years- with locality pay, it has been, at best, 5.9%. And that is for high cost of living areas such as Houston TX, NY, or Washington DC
As long as they don't sneak in a pay raise for Congress which is doing a TERRIBLE job- I'm fine with it.
Citizen worker, not Fed 12/02/09 05:27 pm ET
With such a small pay increase it would not make sense to divert 1/2 the suggested pay increase (the 1% that has been diverted from the annual "average" Congressional total pay increases since 1995).
The RUS folks (the majority of the federal employees would end up with a total pay increase of 1.5 to 1.6% pay increase.
Of course perhaps the folks in Wash., DC who have been garnering the highest year-to-year total pay increases the last two years (2008 & 2009), want a 2.8 to 3.0% pay increase?
Keep in mind folks, the "2%" (or more) is the "average" pay increase if locality pay were increased - but only for the top 12 locality areas.
Taking into consideration all the pay increeases from 1945 to 1993 you may be surprised to know that we all averaged over 4.5% annually. Locality Pay has saved the federal government a load of money by restricting an average 4.5% annual pay increase to one or two localities.
Check out all the pay increases found at OPM.gov if you don't believe me.
Jim Myers 12/02/09 04:56 pm ET