The “2025 COLA for Federal Employees Update” refers to the annual cost-of-living adjustment (COLA) for federal employees in the United States, which is expected to take effect in January 2025. The COLA is a percentage increase in pay that is designed to keep pace with inflation and ensure that federal employees maintain their purchasing power.
The COLA is determined by the Bureau of Labor Statistics’ (BLS) Employment Cost Index (ECI). The ECI measures the change in wages and salaries, including benefits, for all civilian workers in the United States. The COLA is calculated as the percentage change in the ECI from September of the previous year to September of the current year.