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The Definitive 2026 Government Raise: 3.8% Military Hike, 2.8% COLA, And The 4.3% Civilian Debate

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The question of "What is the government raise for 2026?" has been largely answered for most groups, though a final percentage for the 2.2 million Federal Civilian employees remains a critical point of debate as of December 2025. The good news is that two major categories—military personnel and Social Security recipients—have received official, concrete numbers, signaling a continued commitment to cost-of-living adjustments and competitive compensation. The final 2026 pay tables will reflect these adjustments, which are a direct response to recent economic trends, inflation rates, and legislative action.

For US military members, the projected raise is a robust 3.8%, codified through the National Defense Authorization Act (NDAA). Simultaneously, the Social Security Administration (SSA) has announced a 2.8% Cost-of-Living Adjustment (COLA) for 2026, impacting millions of retirees and veterans. The attention now shifts to the General Schedule (GS) employees, where a significant gap exists between the baseline 1% increase proposed by the alternative pay plan and the 4.3% average raise advocated by key Congressional groups.

The Official 2026 U.S. Government Pay Raise Breakdown

The government pay raise for 2026 is not a single, monolithic number. Instead, it is a set of distinct adjustments determined by different legal mechanisms and economic indicators. Understanding the source of each increase is crucial for determining its final percentage and impact.

U.S. Military Basic Pay Increase: 3.8%

The pay raise for active-duty U.S. military personnel is one of the most concrete figures for 2026. This increase is determined by the National Defense Authorization Act (NDAA), which sets the annual defense budget and policy. The proposed raise is a substantial 3.8% increase in basic pay, effective January 1, 2026.

  • Percentage: 3.8% across-the-board increase.
  • Legislative Source: National Defense Authorization Act (NDAA) for Fiscal Year 2026.
  • Impact: Applies to all pay grades, from E-1 to O-10, and is a key factor in maintaining the competitiveness of military compensation compared to the private sector.

Social Security and VA COLA: 2.8%

The Cost-of-Living Adjustment (COLA) for Social Security and Supplemental Security Income (SSI) recipients, which also impacts many military retirees and disabled veterans, is a separate, finalized figure. This adjustment is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).

  • Percentage: 2.8% COLA.
  • Determining Body: Social Security Administration (SSA).
  • Purpose: To ensure that the purchasing power of benefits is not eroded by inflation. This 2.8% increase for 2026 follows a period of higher inflation and is a slight increase from the previous year's adjustment.

Federal Civilian GS Pay: The 1% Baseline vs. The 4.3% FAIR Act Push

The pay raise for General Schedule (GS) employees and other Federal Civilian workers remains the most fluid situation. The final percentage is typically determined by an Executive Order issued by the President in late December, but the process is driven by competing proposals.

The default or "alternative plan" proposed in the budget submission often serves as the lower-end baseline. For 2026, this baseline proposal has been cited as a 1.0% across-the-board base pay increase. This 1% is the figure that takes effect if Congress fails to pass its own legislation or if the President does not issue a higher Executive Order.

However, a significant legislative effort, often spearheaded by the Federal-employee-focused FAIR Act (Federal Adjustment of Income Rates Act), has pushed for a much higher increase to address the pay gap with the private sector. The FAIR Act proposal for 2026 has targeted an average raise of 4.3%.

  • Baseline Proposal: 1.0% base pay increase.
  • Congressional Proposal (FAIR Act): 4.3% average increase.
  • Final Formula: The final GS raise will be a blend of an across-the-board percentage and a locality pay adjustment, which varies by geographic area.

Key Factors Driving the 2026 Salary Adjustments

The final pay percentages are not arbitrary; they are the result of complex economic and political processes that rely on specific metrics and advisory bodies. These factors provide the topical authority for the final figures.

The Employment Cost Index (ECI) and the Pay Gap

The Employment Cost Index (ECI) is the primary metric used to determine the statutory pay raise for federal employees. The ECI measures the change in the costs of labor for businesses. By law, the General Schedule pay adjustment is calculated using the ECI, with a specific deduction. However, the President can—and often does—submit an "alternative pay plan" that supersedes the ECI-based raise, citing national emergency or economic conditions. This is what creates the debate between the lower baseline figure and the higher FAIR Act proposal, which aims to close the persistent pay gap between federal and private sector salaries.

The Role of Locality Pay and the Federal Salary Council

Federal pay is split into two components: the across-the-board increase and the locality pay adjustment. The locality pay component is designed to account for the varying cost of labor and living across different geographic areas. The Federal Salary Council, an advisory body, plays a crucial role by reviewing data and recommending new locality pay areas and the required adjustments for existing ones. For 2026, the Council has continued to review the criteria for new areas, such as the Dothan, AL, Rest of US (RUS) research area, which directly impacts how the total raise is distributed across the country.

The National Defense Authorization Act (NDAA)

Unlike civilian pay, the military pay raise is tied to the NDAA, a massive piece of legislation that must pass annually. The 3.8% military pay raise for 2026 is a result of this legislative process, which often uses the higher of two metrics: the ECI or the proposed percentage to ensure military families are financially supported. The NDAA provides a more stable and predictable mechanism for military compensation increases.

Global Government Pay Projections for 2026

The pressure to adjust public sector salaries is a global phenomenon, driven by high post-pandemic inflation and the competition for skilled labor. Comparing the U.S. projections to those in other major economies provides a unique context for the 2026 figures.

United Kingdom Public Sector Pay

In the UK, public sector pay is determined by Pay Review Bodies (PRBs) and is subject to government spending constraints. For 2026, the median expected pay award across the UK is projected to be around 3.0%. This forecast suggests a continued slowdown from the higher awards seen in 2024 and 2025, as cost pressures on employers ease slightly.

Canadian Federal Employee Salaries

Canadian salary projections for 2026 indicate a modest slowdown compared to previous years but remain competitive. The average base salary increase for Canadian employers, including the public sector, is projected to be between 3.1% and 3.3%. This trend reflects employers navigating economic uncertainty while still needing to attract and retain talent in a tight labor market.

Australian Public Service (APS) Increases

The Australian Public Service (APS) has negotiated multi-year enterprise agreements that provide clear future increases. As part of a three-year deal, Australian public servants are scheduled to receive a 3.0% salary increase from the first full pay period on or after July 1, 2026. This long-term commitment provides significant certainty for federal employees in Australia.

Conclusion: What to Expect Next for Federal Employees

As of late 2025, the government raise picture for 2026 is a mixed but generally positive one. Military families and Social Security recipients can budget with confidence based on the confirmed 3.8% and 2.8% increases, respectively. The final piece of the puzzle—the Federal Civilian General Schedule (GS) pay raise—is expected to be finalized in the coming weeks. While the 1.0% baseline remains the technical default, pressure from Congress and employee advocacy groups makes a final figure closer to the 4.3% FAIR Act proposal a strong possibility. Federal employees should monitor the final Executive Order from the White House, typically issued before the end of December, which will announce the final across-the-board and locality pay percentages that will take effect in January 2026.

The Definitive 2026 Government Raise: 3.8% Military Hike, 2.8% COLA, and the 4.3% Civilian Debate
What is the government raise for 2026?
What is the government raise for 2026?

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