The FAIR Act was introduced on Capitol Hill, giving the first indication to feds for what next year’s raise will be. Also, the president raised the minimum wage for federal employees to $15/hr.
2023 Pay Raise for Federal Employees
The FAIR Act has been introduced in the House of Representatives by Rep. Gerry Connolly (Virginia) for the 7th straight year. While the bill has never made its way to becoming a law, it is usually a good early indicator of what the next year’s federal pay raise will be. As the actual raise that comes to pass has always been less than the raise proposed in the FAIR act, it sets a ceiling for what feds can expect. For example, last year’s iteration of the FAIR act included a 3.2% pay raise for 2022, which saw an actual raise of 2.7%. The 2023 pay raise in the most recent version of the bill is 5.1%, but that figure is actually an average when factoring in locality pay. The “across-the-board” salary increase suggested in the newest bill is 4.1%.
The 5.1% recommendation is the largest raise included in the FAIR act since it was first introduced in 2016, when it proposed 5.3% for the 2017 raise – which ended up being 2.6%. Less than half what was suggested, the first FAIR act was off by the biggest margin yet. The closest the number in the FAIR Act has been to the actual raise was 0.5%, and this happened twice, in 2020 and 2022.
Here is a chart showing the past pay raises suggested by the FAIR Act versus what percentage ended up actually happening the following year:
| Year of FAIR Act | Pay Raise Year | Proposed | Actual | Difference |
| 2016 | 2017 | 5.3% | 2.6% | -2.7 |
| 2017 | 2018 | 3.2% | 1.6% | -1.6 |
| 2018 | 2019 | 3.0% | 1.9% | -1.1 |
| 2019 | 2020 | 3.6% | 3.1% | -0.5 |
| 2020 | 2021 | 3.5% | 1.0% | -2.5 |
| 2021 | 2022 | 3.2% | 2.7% | -0.5 |
| 2022 | 2023 | 5.1% | ??? | ??? |
Minimum Wage Raised for Feds
The FAIR Act has support from federal employee advocacy groups such as NARFE, AFGE, and the NTEU. These organizations also praised a move made by the President on January 24th, when he signed an executive order that gave over 70,000 feds a pay boost by raising the minimum hourly wage to $15 for those in the federal workforce. The federal minimum wage, however, remains stagnant since 2009, sitting at $7.25/hr.
Until Next Time,
**Written by Benjamin Derge, Financial Planner, ChFEBC℠ The information has been obtained from sources considered reliable but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Benjamin Derge and not necessarily those of RJFS or Raymond James. Links are being provided for information purposes only. Expressions of opinion are as of this date and are subject to change without notice. Raymond James is not affiliated with and does not endorse, authorize, or sponsor any of the listed websites or their respective sponsors.
