The Raise Written Into the Contract: The Jobs That Get ...

This is the companion to the piece on COLA versus the private raise. That one showed the government indexing its own obligations to the inflation number it publishes. This one is about the other people on the indexed side of the line: the workers whose raise is written into a contract or a statute, with a number and a date you can point to, rather than left to a manager's discretion at review time.

There are, in the end, only two kinds of raise. One is written down. It has a percentage, an effective date, and sometimes an escalator that fires automatically every year whether the boss likes it or not. The other is discretionary, a line item a manager decides at review season, subject to the budget and the mood of the quarter. Federal employees, service members, public retirees, unionized pilots, and longshoremen live in the first world. The median at-will private worker lives in the second. Over the last five years the gap between those two worlds has been large, and the reason is not that one group works harder. It is that one group has its raise in writing.

None of what follows is an argument that these workers are overpaid. It is the opposite. It is that they did something the average wage-earner has not managed to do, which is convert their leverage into a document, and the document is the whole difference.

The federal floor, indexed but not always generous

The clearest version of a written raise is the one Congress and the President set for the federal workforce every year. It is not left to a manager. For the General Schedule, the average pay adjustment including locality pay ran about 1.0 percent in 2021, 2.7 in 2022, 4.6 in 2023, and 5.2 in 2024, before cooling to 2.0 percent in 2025 (FederalPay.org, compiling the OPM tables). Those are the totals including the locality component; the base schedule raise underneath was a bit lower each year, which is a distinction worth keeping straight.

The honest part of this story is that the indexed floor is not automatically a high one. For 2026 the raise was just 1.0 percent across the board, with locality pay frozen at 2025 levels, signed into effect in December 2025, the smallest federal raise in years and well below the 2.8 percent CPI-W that drove that year's Social Security COLA (GovExec). In real terms that is a pay cut for a federal worker, even in the same year that federal retirees under the older CSRS system and Social Security recipients got the full 2.8 percent. Being inside the system is not a guarantee of a good raise. It is a guarantee of a raise that is decided by a formula and a vote rather than by a supervisor.

The military version is the cleanest, because its raise is bolted by statute to a wage index. Basic pay rose 5.2 percent in 2024, the largest military raise in more than two decades, then 4.5 percent in 2025 with an additional targeted bump of roughly 10 percent for junior enlisted troops, and 3.8 percent for 2026, the last of those set by the Employment Cost Index formula rather than anyone's discretion (Congressional Research Service; Military Times). A service member does not negotiate that number and cannot be denied it. It arrives in the January paycheck because a law says it must.

And then the fine print, because even the indexed world has a catch. Federal retirees under FERS, the system covering everyone hired since the 1980s, do not get the full inflation COLA. They get a reduced "diet COLA," capped at 2 percent when CPI-W rises between 2 and 3 percent, and set to CPI-W minus one point when inflation runs 3 percent or higher. So for 2026, CSRS retirees and Social Security recipients got 2.8 percent while FERS retirees got 2.0 (National Active and Retired Federal Employees Association; the mechanics are statutory and explained in Congressional Research Service report 94-834). It is the government quietly shortchanging its own retirees, and it is a useful reminder that "indexed" and "fully protected" are not the same thing.

State, city, and county: the pension is the raise that keeps going

Below the federal level, the defining benefit of public work is not the salary. It is the pension, and the automatic cost-of-living increase attached to it. About 86 percent of state and local government workers had access to a defined-benefit pension in the government's 2022 benchmark, against just 15 percent in private industry, where the 401(k) has replaced the pension almost entirely (Bureau of Labor Statistics). Many of those pensions carry a COLA that compounds.

CalPERS, the giant California system, is a good worked example. About 95.8 percent of its retirees have a 2 percent COLA provision, and because it compounds, a 2 percent annual increase reaches about 10.4 percent cumulative after five years and never runs backward (CalPERS). The honest caveats matter: the CalPERS COLA is the lower of the compounded contracted rate or actual accumulated inflation, it is capped at 6 percent in any single year for a 2 percent member, and it pays nothing in a year the calculated increase falls under 1 percent, so it lagged badly during the 2022 inflation spike. It is inflation protection, not a full pass-through. But it is a written, compounding escalator on a lifetime benefit, which is something almost no private retiree has.

Active public workers get written raises too, often through their own union contracts. Six AFSCME locals representing more than 10,000 Los Angeles city employees ratified deals in 2024 carrying a 22 percent cost-of-living adjustment over the life of a five-year contract (AFL-CIO). That is a union's own characterization and an illustrative municipal example, not a national norm, but it is the same principle: a number and a date, agreed in advance.

Here too the picture has to stay honest, because public work is not pure gravy. About 28 percent of state and local employees, some 6.5 million workers including roughly 40 percent of public school teachers and more than two-thirds of firefighters and police officers, are not covered by Social Security at all (Congressional Research Service report R47499). For them the pension replaces Social Security rather than stacking on top of it, and they usually contribute a large share of salary to fund it, and they often have to stay five or ten years to vest. The pension is a genuinely better deal for someone who stays. It is not free, and it is not universal.

The union contracts that ran far ahead

The most dramatic written raises of the last three years came out of collective bargaining, and the numbers are worth seeing side by side, because each one is an escalator with an effective date rather than a hope.

Airline pilots led the way. Delta's pilots, through the Air Line Pilots Association, ratified a contract on March 1, 2023 delivering 34 percent in cumulative raises over four years, starting with an 18 percent bump on signing, at a cost to Delta of about 7.2 billion dollars (CNBC). That deal set the pattern. United's pilots followed in September 2023 with cumulative increases of up to about 40 percent (CNBC). American's pilots got an immediate 21 percent raise, with total compensation, counting the 401(k) and other items, rising more than 46 percent over the contract (Allied Pilots Association). And Southwest's pilots ratified a five-year deal in January 2024 with a 29.15 percent raise on ratification and roughly 50 percent compounded over the life of the contract (AirlineGeeks). The exact structure differs by carrier, and the biggest headline figures for American and Southwest include total compensation and back-loaded years rather than a single hourly-rate jump, which is the honest way to read them. But the direction is unmistakable, and it was written down.

The docks tell the same story. The International Longshoremen's Association, which represents East and Gulf Coast dockworkers, ratified a six-year master contract in February 2025, backdated to October 2024, with a 62 percent wage increase that lifts the top base rate from 39 to 63 dollars an hour, approved by about 99 percent of voting members (International Longshoremen's Association). On the West Coast, the ILWU had already ratified a six-year deal with the Pacific Maritime Association in 2023 raising pay 32 percent over the term for some 22,000 workers at 29 ports (Journal of Commerce). The wage-scale percentages here are the solid, primary-sourced numbers; the various "average longshoreman earns 200,000 dollars" figures that circulate come from secondary reporting and should be read as such.

American merchant mariners sit in a related structure worth naming, even though the specific wage numbers are not public in the same way. Unions like the SIU, MEBA, and the Masters, Mates and Pilots crew the United States-flag fleet, and the Jones Act, the Merchant Marine Act of 1920, requires that vessels moving goods between American ports be crewed by American mariners (Catholic Labor Network). These are hiring-hall jobs with negotiated scales rather than at-will positions. The defensible point is structural, that a federal law reserves the work and a union negotiates the pay, not any specific recent raise percentage.

The contractor's inflation clause, which the wage-earner never had

The written-raise world is not only workers. It extends to the companies that sell to the government, and the last few years put that on vivid display. Federal contracts commonly carry an Economic Price Adjustment clause, the mechanism that lets a vendor raise its prices over the life of a contract. When inflation spiked in 2022, the General Services Administration, which runs the schedules that civilian agencies and the military buy from, issued a moratorium on its usual limits on those adjustments. Starting in March 2022 and running through March 2023, contracting officers could approve price increases larger than the standard 10 percent annual cap, more often than the usual three times a year, and even within the first year of an award (PilieroMazza; Winvale). In plain terms, the government handed its own suppliers an inflation escalator, on request, at the very moment the typical private merit raise was stuck near 4 percent.

And the dollars flowing to those suppliers kept climbing. Defense Department contract obligations rose about 10 percent, from 424 billion dollars in fiscal 2022 to 466 billion in fiscal 2023 (Center for Strategic and International Studies), and in fiscal 2024 the Pentagon obligated about 445 billion dollars on contracts, more than every other federal agency combined (Congressional Research Service). Over 2020 through 2024, just five firms, Lockheed Martin, RTX, Boeing, General Dynamics, and Northrop Grumman, took in about 771 billion dollars in Pentagon contracts (Quincy Institute), a research group critical of that spending. A contractor's revenue is not a wage, and the comparison is not that the two are the same. The point is narrower: the entities on the contract side of the government, whether a longshoremen's union or a defense prime, have a written mechanism to pass rising costs through, and the at-will employee has none.

The other side of the line, for contrast

Set all of that against the typical private raise. The Employment Cost Index, the government's cleanest measure of what employers actually pay, showed private-industry wages and salaries rising about 3.4 percent over the year ending March 2026, which after inflation worked out to real growth of about 0.1 percent (Bureau of Labor Statistics). It ran hotter during the 2022 and 2023 inflation spike, in the four-to-five-percent range, then cooled. The point is not that private pay collapsed. It is that it barely beat inflation and came with no guarantee at all, no escalator, no effective date, nothing a worker could point to and enforce.

Union membership does carry a measurable premium. In 2025 full-time union members had median usual weekly earnings of 1,404 dollars against 1,174 for non-union workers, so non-union pay was about 84 percent of union pay (Bureau of Labor Statistics). The Bureau is careful to note that the raw gap also reflects differences in industry, occupation, firm size, and region, so it is not a pure union effect. But part of it is the simple fact of the contract.

The catch: the written-raise world is gated, and shrinking

If the contract is so much better, why is anyone outside it? Because the door is narrow and getting narrower. Union membership fell to 9.9 percent of workers in 2024, a record low, with about 14.3 million members, and the private-sector rate is under 6 percent against roughly a third in the public sector (Bureau of Labor Statistics). Every path above is gated in its own way: a union card and a hiring hall for the docks, a type rating and thousands of flight hours for the cockpit, a competitive hire and a security clearance for federal work, a licensure exam and a vesting cliff for the pension. These are not open enrollments. They are protected positions, and the protection is exactly what makes the raise enforceable, which is the same tension that runs through the piece on the ladders that raise your floor.

So the honest summary is not that pilots and dockworkers and public employees are overpaid, and it is not that the private worker is lazy. It is that the people on the indexed and contracted side of the line did something specific and hard: they organized, licensed, or hired into a position where their raise is a written promise with a date on it, and the average at-will worker has no such document. The raise on that side compounds and cannot be quietly skipped in a lean quarter. The raise on the other side is a decision someone else makes about you every year.

The move, then, is the same one the rest of this series keeps arriving at. Get onto a written-raise ladder if you can reach one, the public-sector, licensed, or unionized paths whose escalators are printed in a contract. And where you cannot, convert some of the un-indexed wage into owned assets that rise on their own, which is the whole argument of the companion piece on the toll economy and the practical playbook. The government tells you the inflation number every year. These are the workers who made sure something with their name on it was tied to the answer.

Fact-check notes and sources

Every figure was checked against a primary or authoritative source; links are inline.

Federal civilian pay (average raises including locality of about 1.0, 2.7, 4.6, 5.2, and 2.0 percent for 2021 through 2025, and the 1.0 percent 2026 raise with frozen locality signed in December 2025): FederalPay.org and GovExec. The base-schedule raise underneath each total was slightly lower; the figures here are the average including locality.
Military basic pay (5.2 percent in 2024, 4.5 percent plus a targeted junior-enlisted boost in 2025, and an ECI-set 3.8 percent for 2026): Congressional Research Service and Military Times.
The FERS diet COLA (2.0 percent for FERS retirees versus 2.8 percent for CSRS and Social Security in 2026, capped by statute): NARFE and Congressional Research Service 94-834.
Public pensions (86 percent defined-benefit access for state and local workers versus 15 percent private; the CalPERS 2 percent compounding COLA at about 95.8 percent of retirees, roughly 10.4 percent over five years, with the lower-of rule, 6 percent cap, and 1 percent floor): Bureau of Labor Statistics and CalPERS. About 28 percent of state and local workers, including roughly 40 percent of teachers and more than two-thirds of first responders, outside Social Security: Congressional Research Service R47499. The Los Angeles AFSCME 22 percent COLA: AFL-CIO, a union source and an illustrative example.
Pilot contracts (Delta 34 percent over four years with 18 percent on signing; United up to about 40 percent; American 21 percent immediate and more than 46 percent in total compensation; Southwest 29.15 percent immediate and roughly 50 percent compounded over five years): CNBC on Delta, CNBC on United, Allied Pilots Association, and AirlineGeeks. The American and Southwest headline figures include total compensation and back-loaded years, noted as such.
Dockworker contracts (ILA 62 percent over six years, top base rate 39 to 63 dollars an hour, ratified February 2025; ILWU 32 percent over six years for about 22,000 workers): International Longshoremen's Association and Journal of Commerce. The circulating total-cost and average-earnings dollar figures are from secondary reporting. Maritime unions and the Jones Act: Catholic Labor Network; no specific maritime wage-increase percentage is asserted because none was independently confirmed.
The private-wage contrast (ECI private wages and salaries up about 3.4 percent for the year ending March 2026, about 0.1 percent real; union median weekly earnings 1,404 versus 1,174 non-union; union membership 9.9 percent in 2024): Bureau of Labor Statistics ECI and BLS union summary. The union-versus-nonunion gap reflects industry, occupation, firm size, and region as well as unionization, per the Bureau's own caution.
The contractor inflation clause (the GSA moratorium on Economic Price Adjustment limits from March 2022 through March 2023; Defense Department contract obligations rising from about 424 billion dollars in fiscal 2022 to 466 billion in fiscal 2023 and about 445 billion in fiscal 2024, more than all other agencies combined; and about 771 billion dollars to five firms over 2020 to 2024): PilieroMazza and Winvale on the GSA policy, CSIS and the Congressional Research Service on obligations, and the Quincy Institute, a research group critical of the spending, on the five-firm total.

This post is informational and journalistic, not career or financial advice. It describes public pay formulas, published contracts, and government wage data. Mentions of specific unions, employers, and agencies are nominative fair use, and no affiliation is implied.

The Raise Written Into the Contract: The Jobs That Get a COLA the Private Paycheck Never Will