Bad Idea: Paying Servicemembers More to Do the Same Amount of Work →

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From CSIS's Bad Ideas in National Security Series:

Because military pay is tied to the ECI, civilian wage increases drive commensurate increases in military pay. This helps retain an all-volunteer force that may be more inclined to leave military service if civilian wages were to increase at a faster rate. But, real increases in civilian pay reflect productivity growth. If the military matches those wage increases without commensurate increases in military productivity, we end up paying more each year for the same amount of output.

2021 Military Pay Table

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Unless Congress or the President intervenes, the annual increase in basic pay for military members is adjusted according to 37 USC 1009. The increase is based on the 12 month percent change in private industry wages and salaries as reported in the September report in the "year before the preceding year" in which the pay raise takes effect. In other words, the pay raise to take effect on January 1, 2020 is based on the September 2018 ECI report.

Congress implemented this automatic adjustment to ensure that military salaries grow in tandem with private industry wages. However, the lag between the measurement of changes in private industry wages and the reflection of that change in military wages is substantial.

Since the Bureau of Labor and Statistics recently released the September 2019 ECI report showing a 3.0 percent increase in private industry wages, it is possible to calculate the 2021 pay table despite the fact that Congress has yet to pass the 2020 NDAA (as of 11/9/19). Presuming the 2020 table reflects the 3.1 percent increase called for in the September 2018 ECI report, the 2021 table will be as follows unless either Congress or the President overrides the law.

2021 Basic Military Pay table at 3.0 percent above 2020 rates
*note O-7 — O-10 pay may be capped