Although it will be the lowest basic pay raise in 40 years, Military Times reported that servicemembers can expect a 1 percent salary increase in 2014. Effective Jan. 1, the raise is a slight drop from the 2011 salary bump of 1.4 percent, which until now was the smallest raise. 

According to the news source, President Obama will use his executive power to cap the basic pay raise at 1 percent, even though the current law sets the rate at 1.8 percent. The House approved a 1.8 percent salary bump for servicemembers last June, but the Senate Armed Services Committee agreed with Obama's 1 percent increase.

Military pay raise has been a hotly contested issue, as Congress leaders struggled this year to reduce the defense spending budget by nearly $500 million by 2020, The New York Times stated. As lawmakers worked to resolve the sequester before the automatic budget cuts begin in 2014, many members of the military community feared that basic pay would be on the chopping block. Stars and Stripes previously reported that a cap on basic pay would be likely, especially because compensation for enlisted members currently exceeds the wages of 90 percent of civilian defense employees.