Federal employees are expected to get an average 2% pay raise in 2025 according to the House appropriations bill. The House Appropriations Committee moved forward with a bill, but it did not succeed in overturning President Biden’s 2025 pay plan.

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Civilian federal employees are set to receive an average 2.0% federal pay raise 2025. The House Appropriations Committee recently moved forward with a spending package that does not address federal worker compensation. Earlier this year, President Biden proposed a 2.0% pay raise for civilian federal employees in his fiscal 2025 budget. This is significantly lower than previous raises: 5.2% in 2024, 4.6% in 2023, and 2.2% in 2022. Biden's proposal also breaks from his past practice of ensuring equal pay raises for both military and civilian federal employees, as the budget includes a 4.5% pay increase for military personnel next year.

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Last month, Rep. Gerry Connolly (D-Va.), who annually sponsors the Federal Adjustment of Income Rates (FAIR) Act, highlighted an issue with the proposed federal employee pay raise for 2025. The FAIR Act aims to increase federal employee pay by an average of 7.4% this year. However, Connolly's team couldn't figure out how President Biden's 2% pay raise proposal was calculated using the data they had.

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Connolly expressed his concerns to Jason Miller, Deputy Director of the Office of Management and Budget, saying, "Based on our analysis, there's no way we could justify a 2% raise. I hope we can discuss this further because 2% is simply not enough for our hardworking federal employees."

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Typically, Congress can override a president’s federal pay plan by adding language to the annual Financial Services and General Government appropriations bill. The House Appropriations Committee moved this bill forward with a 33-24 vote but did not include any language to change next year’s pay raise.

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In the past, Connolly has proposed amendments for larger pay increases when the spending package was debated on the House floor. However, with Republicans controlling the House, the likelihood of these amendments passing seems low.

The Senate Appropriations Committee has yet to release its spending plans for fiscal year 2025.

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Federal Employee Pay Raise 2025 is Not a COLA Adjustment

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Federal employees typically follow news about the cost of living adjustment (COLA) for the next year. For instance, recently estimated 2025 COLA will be 2.7%.

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If you're currently employed by the federal government, the annual COLA won't change your salary. However, if you're retired, this adjustment will increase your retirement income next year. The COLA is calculated using a specific formula and is automatically added to retired federal employees' annuity payments.

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The process for deciding on a federal employee pay raise for the upcoming year is more complex and involves political decision-making, unlike the annual COLA which is straightforward for retirees.

AFGE's Response to President Biden’s 2025 Federal Pay Raise Proposal

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Nation’s Largest Federal Employee Union Criticizes Proposed 2025 Pay Raise

WASHINGTON – Everett Kelley, National President of the American Federation of Government Employees, shared his thoughts on President Biden’s proposed fiscal 2025 budget:

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"We appreciate President Biden's efforts to ensure that corporations and the wealthy pay their fair share in taxes, extend Medicare's solvency, and increase funding for important federal programs.

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However, we are very disappointed that this budget does not maintain pay raise parity between civilian and military federal employees. A 4.5% raise for civilian workers, matching the military, would align with the Employment Cost Index (ECI) and show compliance with the Federal Employee Pay Comparability Act (FEPCA).

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Currently, civilian federal workers earn 27.5% less than private-sector employees. A 2% raise for civilian federal employees in 2025 won't significantly reduce this gap. While we appreciate the steps to address pay compression, these efforts only touch the surface of the larger issue of low federal pay.

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Without addressing the issue of lagging pay for federal workers, recruiting and retaining top talent will remain a challenge due to the burden of low wages."

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The 2025 budget proposal asks for a 4.5% pay increase.

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In 2025, service members are set to receive a 4.5% increase in their basic pay, as part of a $849.8 billion defense spending request submitted to Congress by the Biden administration.

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Some key provisions include:

• More child development centers will be established, along with additional staff to run them.
• Housing and subsistence allowances for service members will also go up.
• $245.3 million will be allocated to raise the Income Eligibility Threshold for Basic Needs Allowance, benefiting service members and their families.
• Over $120 million will be used to support commissaries, helping service members save over 25% on groceries compared to civilian supermarkets.
• $2 billion is earmarked for family housing improvements.
• $1.1 billion will fund the construction of unaccompanied housing and barracks.
• $547 million will be dedicated to preventing suicides.
• $1.2 billion is allocated for initiatives to prevent sexual assaults and other harmful behaviors.

In conclusion, the debate over federal employee pay raise 2025 reveals significant concerns and varying proposals. President Biden's budget suggests a 2% increase, diverging from previous years and prompting criticism from unions like the AFGE advocating for a 4.5% raise to align with military increases and address wage gaps. This decision, made amidst complex political negotiations, underscores ongoing challenges in federal compensation policies and their impacts on recruitment and retention within the government workforce. The final outcome remains uncertain pending further legislative deliberations.