Employee satisfaction and equity in US Army compensation systems

Army Pay

I am currently in the Army, CW2, with a pay grade of W-2 and married to another Service Member. While I support the Army's pay policy, there are clearly disparities in pay and raises are not always equal across the board, again depending on increases in job responsibilities, description, service ratings and other ancillary influences.

In general, because the military is such a hierarchical organization, pay is based on length of time in service; responsibilities (pay grade, supervisory roles, level of specialized education necessary, and a host of other factors). The pay grades and allowances have been standardized for all the services, and do have some exceptions (medical expertise, hazard pay, etc.). Authority for basic pay, issues with absences from duty, special pays and exceptions are outlined in the June 2005 policy changes, with individual yearly changes made in a matrix (Department of the Army, 2005).

Effective January 1, 2014, the Basic Pay matrix runs from E1 to 010 grades-based roughly on 2-year time periods. In general, there are marginal raises between years, with some exceptions. For instance, the military most definitely expects individuals to move upward in rank over a 2-3-year period, or their pay becomes static. For example, E3 grade remains the same after 3 years with no changes. O7-10 pay is limited on an Executive Schedule, and pay when servicing in the Pentagon or Joint Chiefs of Staff has other regulations. Within the pay matrix there are basic housing allowances with and without dependents, again, based on pay grade; clothing allowances, family separation allowances, and a detailed list of incentive and special pays (Aviation, Career, Hazardous Duty, Hostile Fire, Demolition, Diving, Health Professionals, Multi-year retention, Reup bonuses, etc.) (Department of Defense, 2014).

Pay in the military has improved over the past several decades. The competitiveness of the pay is based on the particular specialty, and base pay lagged about 13% behind civilian pay in most areas prior to 2008-2009. However, fresh out of High School, no additional education, a brand new E1 would receive close to $30,000 / annum, including free housing, food and income tax advantage. Compare this with an E6, four children, 10-year's experience in the military, and making about $55,000 / annum. With 10-year's experience and a particular expertise, while the military salary is decent, it is not highly competitive. Similarly, those coming in as officers (commissioned) with 10 years' experience will be making close to $94,000/annum, and depending on expertise, is likely fairly competitive with the civilian sector. Basic pay in the military is taxable unless the person is in a combat or non-tax zone; and depending on one's living situation, a combined military salary using base housing and benefits can be competitive (e.g. two W2s, see below chart) (Powers, 2012).

Hypothetical married W2s with 4 years' experience (monthly)

Combined Salary

$7,399.80

Base Pay

Housing Basic

Dependents

Clothing Allowance

Assumes 1 M, 1 F

Drill Pay

4 drills

Totals

$8,236.47

$98,837.64

As of the 2010-11 Census Reviews, this income represents the 77th percentile in American household income, representing about 1.86% of families. When benefits from the PX, Medical/Dental and educational benefits are added, this is akin to a two-earner family of Teachers with 8+ years' experience, CPAs, and other technical careers (U.S. Census Bureau, 2011).