A key indicator points to a 5.2% military pay raise in 2024, higher than the 4.6% boost set to take effect in 2023 and the largest average increase in more than two decades.

The projected pay hike comes from third quarter Employment Cost Index (ECI) for wages and salaries of private industry workers released Oct. 28 by the Bureau of Labor and Statistics (BLS). The 5.2% ECI figure, if it holds, would pave the way for the largest raise since 2002, when a 5% base raise averaged out to a 6.9% military-wide pay increase thanks to larger, targeted increases, primarily for senior enlisted members.

[RELATED: MOAA's COLA Watch]

MOAA tracks the ECI because uniformed services pay raises are linked to the index by law, with an automatic increase matching that percentage unless the president and Congress authorize a different percentage change. Such an authorization happened from 2014 to 2016, creating a 2.6% gap, or lost wages, between military pay and the cumulative ECI increases over those three years.

In short, servicemember pay is behind where it needs to be, and MOAA remains focused to ensure this does not happen again. Our current efforts urge Congress to fill this pay gap. For a servicemember with six years of service, closing this 2.6% pay gap would mean over $1,000 more per year for an E-5, or over $2,000 more per year for an O-3.

The recent ECI release will inform the FY 2024 NDAA, which would include the pay raise taking effect Jan. 1, 2024. Here’s a look at the correlation since 2008:

• ECI third quarter, 2008: 2.9%, informing a 3.4% military pay raise in the FY 2010 NDAA.
• ECI Q3 2009: 1.4%, FY 2011 raise: 1.4%
• ECI Q3 2010: 1.6%, FY 2012 raise: 1.6%
• ECI Q3 2011: 1.7%, FY 2013 raise: 1.7%
• ECI Q3 2012: 1.8%, FY 2014 raise: 1.0%
• ECI Q3 2013: 1.8%, FY 2015 raise: 1.0%
• ECI Q3 2014: 2.3%, FY 2016 raise: 1.3%
• ECI Q3 2015: 2.1%, FY 2017 raise: 2.1%
• ECI Q3 2016: 2.4%, FY 2018 raise: 2.4%
• ECI Q3 2017: 2.6%, FY 2019 raise: 2.6%
• ECI Q3 2018: 3.1%, FY 2020 raise: 3.1%
• ECI Q3 2019: 3.0%, FY 2021 raise: 3.0%
• ECI Q3 2020: 2.7%, FY 2022 raise: 2.7%
• ECI Q3 2021: 4.6%, Expected FY 2023: 4.6% (Pending NDAA)
• ECI Q3 2022: 5.2%, Expected FY 2024: ??

Lagging Indicator 

Ensuring the uniformed services pay increases with ECI is vital, but MOAA recognizes this increase will happen after a 15-month delay. While this is necessary for the government to effectively budget, it puts service families in a very tight spot when facing record inflation. DoD recently took actions to address housing costs and the cost of moving; these changes will help, but they represent patchwork solutions for the challenges families face.

Supporting Families

While record low unemployment has contributed to this high ECI figure, spousal unemployment rates have not followed the national trend. Military spouses still have unemployment rates that must be addressed. While servicemember pay in 2024 is going up, we need to help support families by ensuring they have access to two steady incomes to support their families.

[TAKE ACTION: Ask Your Lawmakers to Support the Military Spouse Hiring Act]

As the military struggles to recruit new servicemembers, it is important MOAA continues its advocacy for a competitive pay and benefits package, and support services for families. A pay raise matching the ECI is a vital piece of Regular Military Compensation; the 5.2% increase for all eight uniformed services is the mark we must hit for our troops in 2024.

MOAA will vigilantly monitor uniformed servicemember pay and continue its work protecting service-earned benefits. Keep up with the latest MOAA advocacy news at MOAA.org and by following MOAA on Facebook and other social media outlets.