What is Basic Pay?
Basic Pay is by far the primary component of the military pay compensation package. The basic pay rate is computed by the service member’s rank and length of service. All service members received an across the board increase of 3.1 percent on January 1, 2006. In addition to targeted raises for senior enlisted service members and warrant officers, the Pentagon’s goal for 2007 is another across the board increase of 2.2 percent.
Military basic pay has a wide range. For example, the most senior officers such as the Chairman and Vice-Chairman of the Joint Chiefs basic pay is limited to a maximum of $12,666.60 a month while an enlisted service member with less than four months of service earns $1,178.10 a month. Military Annual Pay is capped by law at Level III of the Executive Pay Schedule at $152,000 annually.
There are several factors that have been responsible for narrowing the gap between military pay and compensation for civilians with comparable education and experience. One factor that significantly contributed is in 1999 when Congress enacted a pay raise formula that mandated annual military pay raises be set 0.5 percentage points above average annual hikes in civilian wages noted by the Labor Department’s Employment Cost Index. Another factor narrowing this gap has been five years of targeted raises.