Updated: March 25, 2016
Today, March 24, 2016, the Department of Defense (DoD) publically released the National Defense Budget Estimates for FY 2017, otherwise known as the “Green Book”. The Green Book provides cost projections for future years, normally the five out-years. It is the first official look into what the DoD believes its budget will be and how they plan to spend it.
The FY-2017 Green Book projects military and DoD civilian personnel’s pay raises to be in lockstep for the next five years. For 2017, the projection of 1.6 percent over 2016 approved raise matches President Obama’s proposal he put forth back in February.
Based on the estimates, both 2018 and 2019 will also remain 1.6 percent which is significantly lower (by greater than one percent) than the projected rise in the Employment Cost Index (ECI) based on the Congressional Budget Office’s report, “The Budget and Economic Outlook: 2016 to 2026” (PDF, pg. 170) which was published in January 2016. If those numbers hold true, the pay gap will continue to widen.
With a pay raise a projection of 1.8 percent for 2020 and 2.0 percent for 2021, and with ECI estimates remaining above 3 percent for those years, the military and DoD civilian pay will be less competitive with that of the private sector.