October 28, 2016
Hot off the wire at 8:00 Friday morning: The Bureau of Labor Statistics (BLS) announced the average American saw a 2.4-percent pay raise over the last 12 months.
What's the significance of that?
By law, that will be the basic pay raise currently serving troops will see in January 2018 - unless the new president elects to submit an alternative raise “because of national emergency or serious economic conditions affecting the general welfare.”
In 2004, Congress tied the annual military raise to the annual growth in the BLS' Employment Cost Index (ECI).
Because the 2018 raise has to be submitted in the president's budget a year ahead of time, that raise is determined by measuring ECI growth from September 2015 to September 2016.
The 2017 raise was supposed to be 2.1 percent, based on the ECI standard, but the president proposed an alternative 1.6-percent raise. Congress still has to decide during the post-election lame duck session if it'll let the 1.6-percent pay cap stand or pass legislation raising it back to 2.1 percent.
MOAA worked hard to persuade Congress to enact the ECI standard and believes strongly it should be upheld every year.
Unfortunately, it has been capped below that standard for the last three years. Hopefully, that trend will end for 2017 and 2018.
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