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Critique Of The Department Of Defense Method For Setting And Raising Pay

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Critique of the Department of Defense Method for Setting and Raising Pay
The Department of Defense (DoD) uses a complex system to set pay and grant pay raises for personnel in the military. This system takes into account a variety of factors, including rank, time in service, job specialty, duty location, and other factors. In this paper, I will provide an overview of the DoD's pay system, discuss the impact of the pandemic, economy, and political developments have on the pay scale, and make recommendations for improvements.
Overview of the DoD's Pay System
The DoD uses a pay scale based on rank and time in service. There are nine ranks in the military, ranging from E1 (lowest) to O10 (highest). Within each rank, there are pay grades,
which …show more content…

In addition to rank and time in service, the DoD's pay system takes into account other factors, such as job specialty and duty location. Military personnel who have special skills or work in high-demand fields may be eligible for bonuses or special pay. Those who serve in certain locations, such as combat zones or areas with a high cost of living, also receive additional pay and compensation. Pay raises for military personnel are granted annually and are based on a variety of factors, including the overall economy, inflation rates, and the availability of funding within the DoD. In recent years, pay raises have generally been around 2-3%, which is in line with the rate of inflation. The 2023 DoD pay scale is pictured below. The figures presented below represent the monthly income each Service Member earns, based solely on rank and time in service.
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Figure 1.1 - 2023 Military Pay Scale (DFAS.mil/2023payscale)
Impact of the Pandemic, Economy, and Political Developments on the Pay …show more content…

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Methods for Setting Pay and Granting Pay Raises
The pay of military personnel is determined by Congress through the annual National
Defense Authorization Act (NDAA). The NDAA authorizes pay increases based on the
Employment Cost Index (ECI), which is a measure of the change in wages and salaries of private industry workers. The NDAA also authorizes increases in basic allowance for housing (BAH) and basic allowance for subsistence (BAS) to reflect changes in the cost of living. In addition to the annual pay raise, Service Members may also be eligible for promotion raises. Pay raises due to promotion are based on the pay grade of the Service Members' new rank and the total time spent in service.
Recommendations for Improvements
The current system for setting pay and granting pay raises has been in place for many years, and there are several areas where improvements could be made. One issue is that the ECI does not necessarily reflect the actual cost of living for military personnel, who may be stationed in areas with high housing costs or other expenses. The DoD could consider using a different measure, such as the Consumer Price Index (CPI), which takes into account the

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