What the 1% Federal Pay Raise Means for Government Workers in 2026

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In 2026, most federal employees will see about $24 more per biweekly paycheck. That’s the impact of the 1% pay raise President Trump finalized with an executive order on December 18, 2025, set to take effect on January 11, 2026. For roughly 2.9 million federal civilian workers, this represents their first pay raise that applies to everyone of the new year, and it’s the smallest raise since 2021, when Trump last directed a 1% increase.

Who Gets the 1% Raise (And Who Doesn’t)

The headline sounds universal—”federal employees get 1% raise”—but the reality is more complicated.

The increase applies to federal civilian employees under the standard pay system the government uses for most workers, which covers approximately 1.5 million workers in professional, technical, administrative, and clerical positions. But that’s not everyone working for the federal government.

Military personnel are completely excluded from this raise. Instead, service members will receive a 3.8% pay increase in 2026, a deliberate choice by the administration to provide larger increases to the uniformed services.

U.S. Postal Service employees are also out—their wages are determined by separate contracts negotiated between unions and the Postal Service, not federal pay systems. In 2026, postal employees will see a 1.3% increase as part of their negotiated contract.

Federal contractors don’t receive this raise either. Private company employees working on a federal contract have their compensation determined between them and their employer, not the federal government. Similarly, state and local government employees have no connection to this federal raise—they operate under entirely separate pay systems.

Within the federal civilian workforce itself, there are variations. The standard General Schedule covers most workers, but the federal government also employs people under the pay system for hourly workers like mechanics and maintenance staff, Foreign Service officers, and Veterans Health Administration employees. All of these groups are receiving the 1% raise, but the pay tables they use differ substantially from the General Schedule, meaning the dollar amounts vary.

The Foreign Service Schedule, which covers diplomats and State Department employees abroad, is also increasing by 1%. Veterans Health Administration employees at the Department of Veterans Affairs, including nurses and medical technicians, receive the same 1% increase as General Schedule workers.

Senior Executive Service members—roughly 8,000 of the highest-ranking career federal employees—are getting a 1% increase to their minimum pay rates, though individual increases beyond that depend on performance reviews.

Administrative law judges receive a 1% increase rounded to the nearest $100, reflecting the particular way their salaries are calculated. Federal employees in non-foreign areas who receive extra pay to cover higher costs of living in expensive cities overseas—a smaller group serving overseas—will have corresponding adjustments made to keep their total compensation appropriate.

There is one important exception to the 1%: certain law enforcement officers will receive substantially more.

The Trump administration directed the Office of Personnel Management to identify and provide an additional 2.8% increase (for a total of 3.8%) to federal law enforcement personnel, matching what military personnel will receive. This includes Border Patrol agents, Immigration and Customs Enforcement officers, FBI Special Agents, DEA agents, U.S. Marshals, ATF agents, Federal Bureau of Prisons correctional officers, and officers from other federal law enforcement agencies.

The rationale, according to OPM, is straightforward: “Certain front-line law enforcement personnel are critical to implementing the President’s strategy to secure the border, protect our country, and keep American citizens safe.”

The additional increase is structured as a higher pay rate for certain positions allowed by federal law for positions that are difficult to recruit for, which provides OPM with the authority to establish higher pay rates for positions that face recruitment or retention difficulties.

This means a federal law enforcement officer at GS-12 will receive approximately 3.8% more, while a federal scientist at the same grade receives 1%. This differentiation is intentional policy, reflecting the administration’s hiring priorities.

However, there are salary caps—federal law enforcement special rates cannot exceed the fourth-highest pay level in the federal government, which is projected to be $197,200 in 2026. For some highly paid law enforcement personnel, this cap will limit their increase.

In total, approximately 2.9 million federal workers will be affected by some form of pay increase in 2026, though not all at the same rate. The vast majority—those not in law enforcement—will see the 1% raise that applies to everyone.

What 1% Means: Translating Percentages to Paychecks

Consider a GS-5, Step 1 employee in 2026 (entry-level federal worker, typically someone with a high school diploma and no experience) who will earn a base salary of approximately $30,000 per year. A 1% increase means $300 more annually.

That’s $25 per month, or roughly $11.54 per biweekly check before withholding. After federal income tax withholding, Social Security tax, and Medicare tax are removed—plus any state or local withholding if applicable—take-home will be around $8-$9 per check, depending on their overall tax situation.

A GS-9, Step 5 employee (a mid-level professional, often with a bachelor’s degree) earns approximately $68,000 annually according to 2026 projections. Their 1% raise is about $680 per year, or $35 per biweekly check before withholding. After withholding, they’re looking at roughly $25-$30 per check in take-home increase.

A GS-13, Step 5 employee (a highly skilled professional, typically with advanced education or substantial experience) earns around $100,000 annually. Their 1% is approximately $1,000 per year, or $50 per biweekly check gross. After withholding, that’s somewhere in the neighborhood of $35-$40 per check.

A GS-15, Step 10 employee (the highest regular General Schedule rank, often a manager or specialist with 15+ years of federal service) earns approximately $155,000 annually in many locations. Their 1% raise is about $1,550 per year, or $75 per biweekly check before withholding. After withholding, they’re taking home roughly $50-$60 per biweekly check.

These calculations assume the “Rest of U.S.” locality pay area, which is the catch-all category for federal employees who don’t work in a designated high-cost metropolitan area. Working in a major city means your base salary is higher due to extra pay to cover higher costs of living in expensive cities, which means your 1% raise is also larger in absolute dollars.

Consider a GS-13, Step 5 employee working in Washington, D.C., one of the highest-paid federal localities. Their 2026 base salary is approximately $116,000 annually. Their 1% raise is roughly $1,160 per year, or about $58 per biweekly check before withholding—roughly $40 after withholding.

An identical employee in San Francisco gets an even larger dollar raise because San Francisco has the highest federal extra pay to cover higher costs of living in expensive cities in the nation. That same GS-13, Step 5 gets approximately $133,000 in base salary, so their 1% raise is about $1,330 annually, or $67 per biweekly check before withholding.

The 1% applies only to your base pay and any adjustments that already exist.

The Trump administration froze locality pay rates at 2025 levels, meaning they will not increase beyond what employees already received. This is significant because in recent years, extra pay to cover higher costs of living in expensive cities has added between 0.5% and 1% to overall raises. By freezing locality pay while providing only a 1% base increase, federal workers are getting less total compensation adjustment than they would have received if localities had been adjusted normally.

The 1% is separate from step increases and performance-based raises. Being due for a step increase—which federal employees typically receive every few years based on longevity—happens separately and compounds with the 1% base raise.

Getting promoted to a higher grade means that promotion increase happens separately as well. Your agency deciding to give you an individual performance raise (which is less common now due to tight budgets) would be additional. The 1% is the government-wide baseline adjustment, not your complete compensation picture.

Being at a retained rate—meaning you kept your old salary level temporarily after being moved to a lower-paying job—means the 1% increase works differently for you. Typically, you receive 50% of the increase that would have applied to the maximum of your current grade. This is a catch-up mechanism to help retained-rate employees gradually return to normal salary progression, but it means your raise could be less than 1%.

When and How the Raise Takes Effect: Implementation Details

The 1% raise is set to take effect on January 11, 2026. For most federal employees, that’s the start of the first full biweekly pay period of the year.

Operating on a different pay schedule—some federal employees are paid weekly or every other week on different schedules—means the raise will take effect on your first applicable pay period beginning on or after January 1, 2026.

You don’t need to do anything. The raise is automatic.

Your agency’s payroll system has been updated with the new pay tables, and the raise will simply appear on your paystub starting with that January 11 pay period. Your first check reflecting the raise will likely hit your bank account around January 22-24, depending on your agency’s payroll processing timeline.

The raise takes effect on January 11, but you won’t see the money in your account immediately. Federal agencies follow a standard payroll process where payroll is processed several days after the pay period ends, then sent to your bank. So even though the raise is effective on January 11, your bank account won’t show it until roughly 10 days later, when the paystub for that pay period is deposited.

On your paystub, you’ll see several numbers that have changed. Your federal paystub will show your new base salary rate. You can find the exact rates on the OPM website, which publishes all 2026 General Schedule pay tables.

These tables are organized by locality (Washington-Baltimore-Arlington, San Francisco-Oakland, Los Angeles, and dozens of other designated localities, plus “Rest of U.S.”). You can look up your exact salary by finding your grade, step, and locality.

If the raise doesn’t appear on your January 11 check, first check that your agency has updated their payroll system. Contact your agency’s human resources office or payroll department. Most agencies update their systems in late December to be ready for January, but occasionally errors occur. Missing a raise should be corrected retroactively, meaning you’ll receive back pay for any pay periods in which the raise should have been applied.

One detail matters for employees near the top of the pay scale: the GS pay cap. The maximum salary for a GS-15, Step 10 employee is capped by federal law.

The cap increases from $195,200 to $197,200 due to the 1% raise applied to the Executive Schedule rates that set the cap. Already hitting the pay cap in 2025 means your 1% increase might be less than 1%, because you can’t exceed the cap. Your agency will ensure you receive the appropriate amount, but it may be slightly less than exactly 1% at the top of the pay scale.

Senior Executive Service (SES) members—the highest-ranking career federal employees—don’t automatically get 1% raises the way General Schedule employees do. Instead, SES pay increases are based on individual performance, as determined through a rigorous performance management system.

The minimum SES salary in 2026 is $151,661, which reflects a 1% increase from 2025. Individual SES members may receive more or less than 1% depending on their agency’s budget and their personal performance ratings.

For employees in special circumstances—those on unpaid leave, those with suspended pay, federal employees on military leave—the timing and application of the raise is handled case-by-case by their agencies, typically based on the guidance OPM provides. Being in one of these situations means you should contact your HR office for specifics.

How 1% Compares to Inflation: The Purchasing Power Problem

In July 2025, before this raise was finalized, the inflation rate was 2.7% year-over-year. That means prices had risen 2.7% from July 2024 to July 2025. Federal employees receiving a 1% raise are getting less than half the inflation rate they experienced over the past year.

This creates a gap. Inflation rising 2.7% while your salary rises only 1% means your purchasing power has declined by approximately 1.7% relative to that inflation.

Coffee that cost $5 last year might cost $5.14 in 2026, but your $68,000 salary hasn’t grown enough to keep up with that increase across everything you buy.

From 2015 to 2025, federal pay raises have averaged roughly 1.8% per year. Meanwhile, cumulative inflation over that same decade has exceeded 40%.

This means federal workers’ salaries have not kept pace with the rising cost of living. Someone hired in 2015 at $50,000 would be making approximately $60,000 in 2026 based on raises and step increases. However, if cumulative inflation exceeded 40%, then $50,000 in 2015 would require approximately $70,000 in 2026 to maintain the same purchasing power. Therefore, $60,000 in 2026 would buy approximately 14% less than $50,000 did in 2015 when adjusted for inflation.

In 2024, federal employees received a 5.2% pay raise, the largest since the 1980s, largely because Congress overrode the Trump administration’s initial proposal.

In 2023, the raise was 4.1%. In 2022, it was 2.2%. In 2021, President Trump proposed 1% and it was enacted; Congress did not override him that year. Over the past decade, the average federal raise has been significantly higher than 1%, generally ranging between 2% and 3.5%.

This raise places federal employee compensation growth well below the historical average. It also falls short of what the Federal Salary Council recommended.

The council’s analysis determined that federal workers on average earn 24.72% less than private-sector workers in comparable positions, based on 2024 data. To address this gap over time, the council recommended a 3.3% General Schedule increase based on a formula that measures how much private sector wages grow.

The Trump administration chose not to follow this recommendation, instead exercising an alternative authority to impose a 1% raise and freeze locality pay.

In July 2025, average weekly wages in the private sector grew 4.2% year-over-year, while inflation stood at 2.7%. This means private sector workers were seeing pay increases that outpaced inflation. Federal workers receiving a 1% raise in 2026 will be falling further behind private sector wage growth.

For employees with significant debt, this gap matters. Having a mortgage with a fixed payment means your remaining money left over after paying bills shrinks when your salary doesn’t keep pace with inflation.

Saving for retirement means you’re putting aside dollars that won’t stretch as far when you finally retire. The cumulative effect of year-after-year raises below inflation is substantial over a career.

Every August, by law, the president must submit an alternative pay plan to Congress if they intend to propose something different from what would occur under the normal formula that adjusts pay based on how much prices rise.

The Trump administration submitted its alternative plan on August 28, 2025, proposing the 1% raise and noting that without this plan, “locality pay would increase an average of 18.88 percent, costing $24 billion in the first year alone” alongside a 3.3% base General Schedule increase. The administration presented the 1% and frozen localities as a fiscal responsibility measure, preventing what it characterized as an excessive cost increase to the federal budget.

Congress did not pass alternative legislation overriding this proposal, allowing it to proceed.

Law Enforcement: 3.8% for Certain Federal Workers

While most federal civilian employees are receiving 1%, a subset of federal law enforcement officers are receiving 3.8%—substantially more. This represents a deliberate policy choice to prioritize recruitment and retention in law enforcement positions that the administration considers critical.

The rationale is explicit in federal documentation: “Certain front-line law enforcement personnel are critical to implementing the President’s strategy to secure the border, protect our country, and keep American citizens safe. Without special salary rates, the Government may find it difficult to recruit and/or retain the number of these personnel needed to properly enforce our borders, uphold our immigration laws, and protect law-abiding citizens.”

The 3.8% figure matches the military pay raise for 2026, a deliberate alignment. Federal law enforcement officers covered by this higher raise include Border Patrol agents, CBP officers, Immigration and Customs Enforcement officers, Secret Service personnel, FBI Special Agents, DEA agents, U.S. Marshals, ATF agents, Federal Bureau of Prisons correctional officers, and National Park Service police officers, among others.

The additional 2.8% beyond the base 1% is implemented as a higher pay rate for certain positions rather than as an additional percentage on top of the 1% raise. This distinction matters for regulatory purposes and how the increase is calculated, but the net effect is that a covered law enforcement officer receives 3.8% more total pay increase compared to the 1% most other federal employees receive.

Special rates cannot exceed the fourth-highest pay level in the federal government, which is $197,200 in 2026.

This means some highly paid law enforcement officers will hit this ceiling and receive less than the full 3.8% increase. OPM estimates that “most employees should receive at least a 1 percent adjustment” even with the cap applied, but some will not receive the full 3.8%.

The OPM Director was directed to determine the specific categories of law enforcement personnel eligible for this higher rate after consulting with relevant agencies, including the Department of Homeland Security, Department of Justice, and Department of the Interior. The final list of covered law enforcement positions was still being finalized as of late 2025, with special rate tables expected to be published by December 31, 2025, with an effective date of January 11, 2026.

This two-tier raise system signals that federal pay decisions are not purely based on inflation or cost-of-living formulas—they’re based on policy priorities. Law enforcement gets more because the administration wants to hire and retain more law enforcement officers. Other federal occupations, including scientists, engineers, healthcare workers, and administrative professionals, all receive the 1% baseline.

Long-Term Impact: Retirement, Benefits, and the Years Ahead

A 1% raise in January 2026 affects more than that month’s check. It affects several other parts of your federal pay and benefits, with implications for the rest of your career and into retirement.

For employees covered by the main federal retirement system, which includes most federal employees hired after 1984, the raise affects your monthly retirement payment calculation through your average salary during your three highest-paid years of work. Your federal pension is calculated based on your average salary during your highest-paid three consecutive years of service, multiplied by the formula set by law that depends on your age and years of service.

A 1% raise in 2026 slightly increases what those “high-3” years might be, which incrementally increases the pension you’ll eventually receive, but the effect is modest. For someone retiring in 2030, the additional income from a 1% raise in 2026 is spread across 36 months of calculations, meaning it increases their high-3 by much less than 1%—perhaps 0.25-0.3%.

Someone born January 1, 1962, who is considering whether to retire at the end of December 2025 or in January 2026, would see their high-3 average increase slightly by waiting.

That small increase compounds across potentially 20 or 30 years of retirement income, making it worthwhile for some employees. However, this is highly individual and depends on your specific situation, age, and years of service.

For contributions to the federal retirement savings plan—the federal government’s 401(k)-style retirement savings plan—the raise affects both the automatic 1% agency contribution and matching. Contributing 5% or more of your salary means your agency matches up to 4% of your salary.

With a 1% raise, your salary base increases, and maintaining the same percentage contribution rate means your dollar contributions increase automatically. For example, someone contributing 5% of their salary who receives a 1% raise will increase their contributions by 1%, from $3,400 to $3,434 annually (using simplified math). The agency’s matching contributions also increase proportionally.

In 2026, federal employees under age 50 can contribute up to $24,500 annually (combining traditional and Roth contributions). Employees age 50 or older can contribute $32,500, and those ages 60-63 can contribute $35,750.

Your salary rising while you maintain a high contribution percentage could mean you reach these limits sooner in the year, which would suspend agency matching contributions for the remainder of the year. This is a relatively minor concern for most employees but important for high earners and aggressive savers.

Your Social Security earnings record also increases slightly. Employees pay Social Security on their federal salary, and that salary counts toward your Social Security benefit calculation when you eventually claim Social Security. A 1% increase in 2026 means slightly higher Social Security benefit when you eventually reach age 62 or older, though the increase is modest—perhaps $10-$20 per month in the extreme long term.

For federal employees with health insurance through the federal health insurance program, which covers approximately 8.2 million federal workers and retirees, the 1% raise doesn’t directly affect premiums, which are set by the insurance carriers. However, health insurance premiums are increasing substantially in 2026 regardless.

The overall average premium increase across all plans is 10.2%—significantly higher than the 1% federal pay raise. This means employees’ net compensation gain is being partially offset by higher insurance costs. The government contributes toward premiums, but employees typically pay a portion. Someone receiving a 1% raise may see most of that increase consumed by higher health insurance contributions.

Federal employees who participate in accounts where you set aside money before taxes to pay for healthcare have higher contribution limits for 2026. The Healthcare FSA limit increases from $3,300 to $3,400 annually, and the Dependent Care FSA limit increases from $5,000 to $7,500.

These higher limits allow employees to save more pre-tax dollars, which can help offset higher healthcare costs, but the 1% pay raise doesn’t automatically increase FSA contributions—employees must actively increase their contributions to take advantage of the new limits.

Federal employees receive step increases roughly every one to three years based on longevity (different waiting periods for different step ranges). They may also receive promotions, which bring substantially larger pay increases.

Someone who receives consistent step increases and occasional promotions will see their salary grow significantly over a 30-year career, and the 1% baseline raise is one component. However, baseline raises consistently lagging inflation—as they have over the past decade—means even with step increases and promotions, pay increases that outpace inflation can stagnate.

The Broader Context: Why 1% and What Federal Employee Unions Say

The decision to implement a 1% federal pay raise, frozen locality pay, and a 3.8% increase only for law enforcement reflects both budget constraints and policy priorities. It’s also deeply controversial within the federal workforce.

The 1990 law that sets how federal pay raises are decided established the process by which federal pay raises are determined. Under this law, the president is supposed to submit a pay plan by September 1 each year that either follows the formula set by law (a raise equal to private sector wage and salary growth as measured by a formula that measures how much private sector wages grow, minus 0.5 percentage points) or provides an alternative plan with justification to Congress.

For 2026, that calculation would have suggested a 3.3% base increase to the General Schedule, plus whatever adjustments the Federal Salary Council recommended (which were substantial, averaging 25.54% increase in total across localities to bring federal pay closer to private sector pay). But the Trump administration exercised its authority to submit an alternative plan instead.

In an August 28, 2025 memorandum to Congress, Trump wrote: “Federal employee pay must be based on merit and practical skill and aligned with the budget and my administration’s goals of streamlining the federal workforce and reducing federal spending. My alternative pay plan will further my administration’s efforts to create an excellent and efficient federal workforce of the highest caliber while maintaining fiscal responsibility.”

The White House’s core argument is fiscal: the formula set by law would cost too much. Without the alternative plan, “locality pay would increase an average of 18.88 percent, costing $24 billion in the first year alone. This change would go into effect in January 2026 along with an additional 3.3 percent raise for the base General Schedule.”

The alternative plan—1% base raise plus frozen locality pay—costs substantially less, approximately $2.3 billion according to administration estimates, compared to the $24+ billion cost of the approach set by law.

Federal employee unions strongly opposed this approach. The National Treasury Employees Union (NTEU), which represents federal employees across 32 federal agencies, called the raise “meager” and “inadequate.”

NTEU President Doreen Greenwald stated: “At the very least, the planned 3.8 percent average increase for military and federal law enforcement should be extended to all federal employees. Even better, NTEU has endorsed legislation that would give all federal employees an average 4.3 percent raise next year.”

The American Federation of Government Employees (AFGE) echoed similar concerns and has endorsed legislation for a 4.3% raise across all federal employees. These unions point out that federal employees have not received pay raises keeping pace with inflation over the past decade, and the 1% raise exacerbates that problem.

During Trump’s first term (2017-2021), he proposed pay freezes for three of the four years, and Congress overrode him each time, providing raises ranging from 1.4% to 2.6%.

In 2021, Trump’s final year, he proposed a 1% raise and Congress did not override him. In 2022-2024, under the Biden administration, federal employees received 2.2%, 4.1%, and 5.2% raises respectively, the latter being the largest since the 1980s.

Congress no longer always overrides presidential proposals. The current Congress did not pass alternative legislation regarding the 2026 federal pay raise, allowing the 1% plan to proceed. This reflects broader political dynamics around federal workforce size and spending.

More than 300,000 federal employees left government employment during 2025, a roughly 9% decline in the workforce.

Many left through buyout programs that paid employees to leave, but the net effect is that the federal government has experienced substantial staffing losses. Federal agencies report difficulties recruiting for many positions, particularly in specialized fields like cybersecurity, engineering, and law enforcement.

The administration’s response to these challenges is selective: offer more money (3.8%) to law enforcement and border security positions aligned with administration priorities, while providing the minimum raise (1%) to most other federal occupations.

This strategy reflects a conscious choice about federal workforce priorities. The administration is signaling that it wants federal employment in some areas to shrink (through minimal raises and continued workforce reduction efforts), while wanting federal employment in law enforcement to expand (through preferential higher raises). This is policy working through compensation mechanisms.

What Happens Next and What Employees Should Monitor

The 1% raise takes effect January 11, 2026, and barring extraordinary circumstances, it’s final for that year. Congress could theoretically pass legislation to increase federal pay retroactively (it has occasionally done this), but such action is rare and not expected in 2026.

Federal employees should monitor several developments that could affect future compensation:

Pending litigation over federal workforce policies could affect pay systems. The Trump administration has faced multiple lawsuits regarding layoff procedures, collective bargaining rights, and civil service protections. While these don’t directly affect the 2026 pay raise, they could influence how federal compensation is administered in coming years.

Congressional response to the 1% raise could shape 2027. Bipartisan concern about federal pay falling further behind private sector compensation might lead Congress to override a future presidential pay proposal. The Federal Salary Council will continue issuing annual reports on the federal-private pay gap, which provide ammunition for advocates pushing for larger raises.

Federal workforce trends matter. The administration successfully reducing the federal workforce through continued paying employees to retire or quit means agencies will face staffing challenges that could eventually pressure compensation upward for retention and recruitment. Agencies unable to fill positions sometimes see Congress respond by authorizing pay increases for affected occupations.

Presidential elections and congressional elections create political dynamics around federal workforce issues. Administration priorities around federal workforce size and composition will shape how compensation decisions get made.

For individual federal employees, verify the 1% raise appears on your January 11-24 check, confirm the amount on your paystub matches the published 2026 pay tables for your grade, step, and locality, and contact your HR office immediately if the raise doesn’t appear.

Planning to retire in the next few years means you should run retirement estimates to see how the 1% raise affects your high-3 average and eventual monthly retirement payment. Maxing out contributions requires monitoring whether your salary increase pushes you to contribution limits that would suspend agency matching contributions mid-year. Having federal financial advisors or union representatives means they can help you calculate personal impacts.

The 1% raise is emblematic of a larger federal compensation story: federal employees’ salaries have not kept pace with the cost of living over the past decade, and the 1% raise perpetuates that trend. At the same time, the 3.8% increase for law enforcement shows that targeted compensation increases are possible when administration priorities align.

For the vast majority of federal employees, the 1% raise means modestly more purchasing power—roughly $50-$100 per month before withholding, depending on salary—but substantially less than inflation rates experienced recently, meaning purchasing power in real terms continues to decline relative to the private sector.

The gap between what federal employees earn and what they could earn in the private sector continues to widen. The Federal Salary Council’s finding that federal workers earn 24.72% less than comparable private sector workers is a reflection of choices about how we value public service.

A 1% raise in an environment of 2.7% inflation and 4.2% private sector wage growth sends a clear message about those priorities. Federal employees will see a few extra dollars per check starting in late January. Whether that’s enough to retain the skilled workforce needed to run the federal government is a different question entirely.

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