What Changes Can Federal Workers Expect in 2025?

Federal workers can anticipate several significant changes in 2025, with the most notable being related to pay and workplace policies.

Pay Adjustments: The proposed federal pay raise for 2025 is a key area of focus. The Biden administration has suggested a 2% increase for civilian federal employees, which has sparked concern among unions and advocacy groups. This increase is seen as insufficient given the recent inflation rates and the growing pay gap between federal and private sector employees. In contrast, there is also a proposal in Congress for a more substantial 7.4% pay raise, which includes a 4% base pay increase and an additional 3.4% for locality pay adjustments. This larger raise aims to address the widening pay gap and support recruitment and retention efforts within the federal workforce.

Workplace Policies: Changes in workplace policies are also expected, especially regarding remote work and in-office requirements. The Biden administration has been pushing for a significant return to in-office work, following the increased telework arrangements that were adopted during the COVID-19 pandemic. Agencies are being directed to ensure that federal employees spend more time working in person, which could lead to substantial changes in how federal work is structured.

Wage Grade System Reforms: There are discussions about overhauling the Wage Grade (WG) system, which currently governs pay for federal employees in trades and labor positions. The system, designed post-World War II, is seen as outdated, failing to keep pace with the evolving nature of these jobs and the private sector. Reforms may include adjustments to make the system more reflective of current job requirements and geographic cost variations.

These changes are part of broader efforts to modernize the federal workforce and address the challenges posed by inflation, recruitment, and retention​.