By Ros Krasny
HONOLULU (Reuters) - President Barack Obama, as signaled earlier in the year, signed an executive order on Monday setting federal civilian and military pay rates for 2014, and including the first raise for civilian workers in four years.
Military and civilian employees will get a 1 percent raise in the new year, consistent with the level laid out in Obama's earlier budget proposal.
The order had to be signed before January 1 to allow federal agencies to update their pay systems for the new year.
Congress could have declined to authorize the increases on at least two occasions in recent months, including when lawmakers passed a two-year budget agreement earlier this month, but chose not to intervene.
Federal civilian workers have had their pay frozen for three years. Military employees have received a salary increase each year that Obama has been in office, the White House said.
Steny Hoyer of Maryland, the Democratic Whip in the House of Representatives, praised the move as a "modest but important step" against the background of an improving economy.
Revised figures last week showed economic growth in the United States was an annualized 4.1 percent in the third quarter, the strongest since the final three months of 2011.
"In the case of federal civilian employees ... given that these hardworking public servants have already contributed nearly $114 billion toward deficit reduction and some were furloughed as a result of the shutdown and the sequester, it is long overdue," Hoyer said.
Employee unions have praised the increase as a small first step toward relief for the mostly middle-class workers on the federal payroll.
Still, those workers continue to lose ground in real terms. The latest annual inflation rate for the United States was 1.2 percent for the 12 months ended November 2013. For calendar 2012 the rate was 2.1 percent.
(Reporting by Ros Krasny; Editing by Gary Hill)