A photo illustration of US 100 dollar bills

Military Pay and Benefits: Surprising Facts You Should Know

Insiders on Capitol Hill still believe US military soldiers are well compensated compared to their civilian peers. The Senate Armed Service Committee appears angled toward throwing water on calls to increase military salaries from the House.

Subscribe to our weekly newsletter and stay up to date.
 

For years, this view of soldiers being well compensated has poisoned debates at the Capitol at times when we must ensure our US military is competitive and successfully recruiting new servicemembers. 

The rub historically has been the failure of Congress to fully appreciate servicemembers are working 24 hours per day, not only 8 hours per day. 

When the Pentagon says “Jump,” we say “How high?” When the Pentagon requires us to get injected with experimental treatments and vaccines, we say, “Thank you, sir. May I have another?” Failure to obey an order is punishable up to and including death.

There exists no civilian equivalent. Whenever you read reports from Congress, the Congressional Budget Office, or the multitude of think tanks informing our elected officials about how great we have it in the military, always review it with a skeptical eye.

What follows is not my opinion. It is a synthesis of what Congress is being told about military pay in the current inflationary cycle.

  • Your pay is calculated at $15 per hour (using a 40 hour workweek)
  • The pay raise is 5.2% is considered substantial
  • The CBO believes servicemembers are “well compensated”
  • One Senator believes our pay is “competitive”

What do you think? Are servicemembers well compensated?

Here is our synthesis of what Congress asked the CBO about military compensation likely with a focus on recruiting problems.

CBO On Military Pay

A recent analysis by the Congressional Budget Office (CBO) has shed new light on military compensation, challenging common perceptions and raising questions about the need for increased awareness of the advantages it offers. 

The report examines various aspects of service member compensation, encompassing basic pay, medical benefits, and housing support. Notably, it attempts to dispel misconceptions, suggesting that enlisted personnel receive cash compensation that surpasses that of approximately 90% of civilians of the same age and education.

That is, if a servicemember only works 40 hours per week. 

(I remember missing not just one Christmas vacation because, apparently, Saddam Husein failed to get the memo that the US military only fought wars 40 hours per week.)

Is Military Pay Competitive? 

The CBO’s findings were prompted by inquiries from Senate Armed Services Committee members, who sought to determine if annual military pay raises are sufficient to maintain competitiveness with civilian employers. 

Surprising to some, the study concludes that current compensation levels for military personnel not only meet but exceed the Defense Department’s objective of cash compensation reaching or surpassing the 70th percentile of civilian earnings.

But how high is the Pentagon’s objective, really?

Beyond Take-Home Pay: Hidden Benefits 

The report could be taken as revealing striking revelations.

For example, one such revelation is that servicemembers receive a significant portion of their overall compensation in noncash and deferred benefits, a feature uncommon in the private sector. Many servicemembers, per the report, underestimate the full value of these deferred benefits. If true, this raises the question of whether a more comprehensive understanding of military compensation, beyond take-home pay, could enhance recruiting and retention efforts.

Of course, the CBO report fails to account for the real obligations and risks many servicemembers face each and every day that nonservicemembers never experience.

A Detailed Breakdown of Compensation:

  • Entry-level troops currently earn approximately $21,000 in salary.
  • For those holding ranks E-4 and above, as well as individuals with at least three years of service, basic pay can reach around $31,200. This translates to an hourly wage of $15 for a standard 40-hour work week.

Again, missing from their calculus is the very real cost of war including exponentially higher divorce rates and impacts on families that somehow evades the CBO. Not to mention the reality that many military families require and qualify for food stamps to get by.

Let’s also not mention that if the budget does not pass, servicemembers would be without pay. In the civilian sector, if the boss does not pay the wage, the person can quite and sue the employer. But that is simply not an option for servicemembers.

Uncovering Hidden Benefits 

The CBO seems to couch veterans’ benefits as hidden benefits not taken into account. This tactic could be used to throw shade at any politician advocating for higher pay and benefits.

The figures mentioned above exclusively represent take-home pay. They do not account for other crucial benefits, including military health care, monthly housing stipends, future GI Bill benefits, and various enlistment and reenlistment bonuses.

Some use this slight of hand as a device to support lower pay increases than what is otherwise called for.

Potential for a Shift in Perspective 

The report suggests that if service members received more take-home pay but were responsible for covering the costs of these benefits, it could provide a clearer picture of the substantial cash compensation available to military personnel. 

While the CBO isn’t advocating a significant overhaul of the military compensation system, it does highlight the need for better education about the comprehensive array of military pay and benefits. This knowledge could be instrumental in bolstering recruitment and retention efforts.

I would be curious to find out what retired military leaders think of CBOs suggestion.

Policy Implications and Future Outlook 

As lawmakers in both the House and Senate work on finalizing federal budget plans for fiscal 2024, a 5.2% pay raise for all service members is on the horizon, marking the most substantial annual increase since 2002. But is a 5.2% increase really “substantial” with the rampant inflation we’ve been dealing with over the past few years?

House Republicans have also proposed a provision in their Defense Department appropriations plan that guarantees a minimum base pay of $31,000 for all service members, potentially augmenting the incomes of junior enlisted troops. I think we can all agree that a pay raise must be considered, especially in the face of waning recruitment numbers.

In the wake of these CBO revelations, otherwise known as rhetorical spin, the debate surrounding military compensation continues. 

What is the debate?

While the White House expresses concerns about the long-term implications of significant pay changes, the CBO’s report underscores the importance of informed discussions about military pay and benefits. Ultimately, a better-informed public and potential recruits may be the key to enhancing the attractiveness of military service in the United States.

Similar Posts

3 Comments

  1. I served for a total of 42 years in 3 services. Obviously I like the life.
    HOWEVER, Very often I was working 18 hour days In the Navy maintaining 41 separate and individual systems as well as standing Engine room and Central Control Station watches at sea which were totally outside the purview of my rating. ALSO operating the Closed Circuit Television Ships Entertainment system.
    I have worked 36, 42 and 78 ours strait the last ending in a nervous breakdown. It came to the point that after an hour on ordered bedrest I had been awakened 4 times within that hour it was ordered that a watch was placed on my rack to prevent Officers and Senior enlisted from coming to me for more work. Often when other responsible parties were having problems they could not figure out I was called in to see what I could do and most often I was able to troubleshoot and repair their assigned equipment. Including top secret equipment requiring repairs through Pentagon assignment.
    While as an instructor I worked 18 hour days for over 6 months to get sailors trained for sea duty.
    I was and most likely still am the most qualified sailor in my career field with 11 Naval Education Codes (NEC). The average is 3. I personally wrote 3 courses for the US Navy and over 3000 questions for the testing bank.
    I was investigated for cheating on the advancement exam simply because I got the highest score recorded. I was then required to take the test again with 3 observers while the were asking me additional questions at the same time. The result was a better score and the 3 higher ranking enlisted asking me how I could do that. I asked them if the had actually checked my records and qualifications?
    Even after that I still was not advanced for another 3 cycles, perhaps because of the “equal opportunity” agenda.
    I was an E6 for over 10 years even though my qualifications were impeccable. I had advanced first time every time until that point.
    Ready for the kicker? I was told at my retirement, I was submitted for the Congressional Medal of Honor. The basis for that was perhaps for the saving of 40+ sailors lives. I am not sure or perhaps for prior military service events.

  2. Well paid compared to what? Who has a job where they are potentially shot at? Police officers. What is an average police officer salary? I would guess $60,000-70,000 as entry level. When I was active duty I rarely worked less than 10 hours a day and sometimes for 3-4 days with nothing more than a 15 minute nap here and there.

    Lets compare them to congress and the pay they receive $170,000 for a 30 hour week. They are over compensated.

  3. Not to mention the civilian pay statistics the OBM used to determine that military is paid in the 70th percentile of their civilian counterparts is years old (pre pandemic).

Comments are closed.