|Updated: 12/09/2010 9:29 am
||Published: 11/29/2010 4:20 pm
About 9,000 Arkansas employees may not get pay raises for the next two years with president Obama announcing Monday a plan to freeze the salaries for all federal employees.
This is still a proposal. President Obama will need Congress to act before federal employees here in Arkansas see their salaries frozen.
Drive around Little Rock, you'll come across plenty of places where federal employees are. Hundreds work inside the federal building downtown as well as the federal courthouse next door.
The president on Monday said now is the time for federal employees to step up.
"All of us are called on to make some sacrifices and I'm asking civil servants to do what they've always done, play their part," Obama says.
That even includes jobs like air-traffic controllers at the Little Rock National Airport. Michael Pakko at UALR is the state chief economic forecaster. He says the average salary for a federal worker in Arkansas is nearly $60,000. Meaning employees will miss out on an $850 cost of living increase next year.
"It makes a difference but it won’t really, in any significant way, change the pay," Pakko says. "This is an opportunity for Obama and the new Republicans in Congress to agree on something anyway."
One exception to the proposal, the pay-freeze will not affect the military. The United States Postal Service has 4400 employees in Arkansas. Spokesperson Leisa Tolliver-Gay with USPS in Little Rock says it’s unclear from the proposal whether or not those employees will be included.
"Going forward we're going to have make some additional very tough decisions that this town has put off for a very long time," Obama says.
The move is expected to save $5 billion over the next two years and as much as $60 billion over the next ten years.
Pakko says the pay freeze will shave less than 1% off the federal deficit. Still, congressman-elect Tim Griffin R-AR 2 calls the pay freeze "a welcome step", saying Democrats and Republicans have a lot of work ahead to bring the federal deficit under control.