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Washington, D.C.—In the face of a growing realization in both Congress and the public of the pressing need to reinvigorate interest in public service employment, new Employment Cost Index (ECI) figures suggesting a federal civilian pay increase for the year 2003 would do nothing to help with such efforts, the head of the nation’s largest independent union of federal workers said today.

President Colleen M. Kelley of the National Treasury Employees Union (NTEU) said that figures released by the Labor Department’s Bureau of Labor Statistics (BLS) suggest a 2003 civilian pay increase of only 3.1 percent.

“That is completely inadequate not only to fairly compensate current federal employees for the tremendous work they do, but it’s not even within shouting distance of the amount needed to encourage the most qualified workers in our country to consider federal employment,” Kelley said.

She urged the administration, in its budget planning for 2003, to propose a federal pay increase “that meets a real and demonstrated need” to appropriately pay present federal workers and attract others to federal service.

The NTEU leader was responding to release by BLS of the ECI, a measure of changes in both public and private sector costs of wages, salaries and benefits over a 12-month period ending in September. It is a central

component in calculating federal pay raises.

Under the formula provided in the Federal Employees Pay Comparability Act (FEPCA), the federal pay increase should be calculated by subtracting 0.5 percent from the ECI, then adding a locality adjustment to account for regional cost differentials. But the locality adjustment has been ignored for some years, leading to a gap of 13 to 33 percent between public and private sector pay, depending on location.

Kelley said one partial solution to federal compensation problems would be to actually add the calculated locality adjustments for 2003, rather than following the practice of much of the past decade of taking a portion of the basic pay increase—usually one percentage point of it—and distributing it as locality pay.

BLS reported the ECI for the 12-months ending September 30 at 3.6 percent. Subtracting the half-percent under the FEPCA formula would lead to a 2003 federal civilian pay increase of 3.1 percent—even less than the 3.6 percent the administration is proposing for 2002.

In recent days, a new public-private organization, the Partnership for Public Service, which is designed to encourage job-seekers to look to federal careers, said that its research helped identify low pay as one of the most significant factors hurting federal recruitment and retention efforts.

Eighty-nine percent of respondents to a Hart-Teeter poll conducted for the Partnership and the Council for Excellence in Government, said the higher federal pay would be a major incentive in assisting agency hiring efforts.

Kelley, who is both a member of the Federal Salary Council and the Partnership’s Advisory Board of Governors, has been the leading advocate for closing the public-private pay gap. “No matter how hard we work to make federal employment more attractive,” she said, “we are not going to succeed unless and until the federal government offers pay competitive with the private sector—all the polls show it, and everyone who has looked at this problem knows and understands this.” NTEU represents some 150,000 employees in 25 agencies and departments.