CBO says military pay gap is exaggerated

The pay gap between military and private-sector pay isn't as high as the Pentagon claims, and in fact some service members make more than their civilian counterparts, a Congressional Budget Office official told a Senate panel Wednesday.

The most commonly cited figure for the military-civilian pay gap is 13 percent, Christopher Jehn, assistant director of CBO's National Security Division, said Tuesday at a hearing of the Senate Armed Services Subcommittee on Personnel.

But a CBO analysis of the pay gap found that enlisted personnel actually make about 3 percent to 10 percent more money than their civilian peers, while officers are paid between 6 percent and 12 percent less than people in similar jobs in the private sector.

What's more, Jehn said, "no matter how carefully calculated," the pay gap "says nothing about either the fairness of military pay or of the adequacy of that pay to support DoD's personnel needs."

Congress would be able to do a better job of setting Defense pay if DoD studied its retention patterns, Jehn said. "If retention or recruiting is a problem only for some services, some occupations, or a few years of service, then other solutions may be more cost-effective than across-the-board increases," he said. Those solutions could include bonuses or changes in military pay tables.

Jehn also took issue with the popular notion that the Military Reform Act of 1986 (known as "Redux"), which trimmed retirement benefits for some service members, is responsible for a recent exodus of midcareer military personnel. CBO found no statistical link between Redux and retention among members of the Army, Marine Corps and Air Force who began active duty in 1987, and found only moderate effects among members of the Navy.

"Any large declines in midcareer retention that have been observed in the armed forces probably result from other factors," Jehn said.

Nonetheless, the Pentagon says bonuses and special pay aren't enough to keep troops happy. "It comes back to the question, 'Do I have confidence that this is a solid way to spend a career?' " a DoD official said.

The Clinton administration's fiscal 2000 budget includes a 4.4 percent across-the-board military pay raise, while the Senate last month proposed a 4.8 percent military raise.