Is Pay Debate Over?:

Depending on how you calculate military compensation, the Congressional Budget Office says in a new report that military pay now compares “favorably” with civilian compensation. The report must come as vindication for some defense observers who have claimed for years that there is no pay gap, even as Congress has continued to boost military pay at a slightly higher rate (0.5 percent) than wages in the civilian sector. And, it would appear lawmakers may extend that half percent boost above the employment cost index for another few years as a continuing means to offset a potentially difficult recruiting and retention environment. CBO analysts do point out that military to civilian pay comparisons are “problematic,” most obviously because of “different job characteristics.” Still, CBO would seem to prefer the broad approach toward calculating military compensation, considering noncash and deferred cash benefits and special pays and bonuses as well as the traditional regular military compensation—basic pay, housing and subsistence allowances, and associated tax advantages. DOD and Congress typically use RMC as a guide in determining the extent—if any—of a pay gap. (This CBO report and last year’s Defense Advisory Committee on Military Compensation report, which doesn’t touch on the military-civilian pay gap but does recommend an overhaul of the pay system, can be found in The Document File on this page.)