Houston, TX vs Rest of U.S.: GS pay compared, 2026

How cheap would it have to be?

Rest of U.S. has no metropolitan price index of its own, so the straight purchasing-power comparison cannot be made — and we are not going to invent a number for it. The question turns round, though, and in that form it has an exact answer.

A GS-12 step 5 in Houston, TX earns $116,990 where prices stand at 98.6 against a national average of 100. That buys what $118,616 buys at average U.S. prices. The same grade on the Rest of U.S. rate earns $101,443. For those two to come out equal, the place you live on the Rest of U.S. rate would need a price level of 85.5 or below.

Not one of the 57 measured localities is that cheap. On this comparison Houston, TX wins outright, and it is not close.

One caution on reading it. The price index describes what things cost now, not what they cost you: a mortgage signed years ago, or a house owned outright, changes the arithmetic in a way no published index can see.

Step by step at GS-12

Comparing offers rarely means comparing the same cell. This is GS-12 across all ten steps in both areas, so a step 3 offer in one can be read against a step 7 offer in the other without arithmetic.

Overtime is capped, and the cap differs

Under 5 U.S.C. 5542 an overtime hour is paid at one and a half times your hourly rate only while that rate stays at or below the hourly rate of GS-10 step 1 in your own locality. Above it, the hour is paid at the greater of your own rate and one and a half times that GS-10 step 1 figure — not both.

That threshold is a local number, so it differs between these two areas: $37.56 an hour in Houston, TX against $32.57 in Rest of U.S. A GS-12 step 5 earns $56.06 an hour in Houston, TX and $48.61 in Rest of U.S., and is paid $56.34 and $48.86 respectively for an overtime hour.

In both areas the overtime hour still carries a genuine premium at this grade. It stops doing so higher up the schedule, and sooner in the better-paid area.

Where raises stop counting

No General Schedule rate may exceed Level IV of the Executive Schedule, $197,200 in 2026. Inside that band a step increase produces a bigger number in the formula, the law cuts it back, and the payslip does not move.

Houston, TX has 5 of its 150 cells pinned to the ceiling. Rest of U.S. has none: every step increase there is worth its full face value. Over a career at the top grades that reverses part of the headline gap.

What Rest of U.S. actually means

Rest of U.S. is not a place and not a leftover category for small towns. It is the rate that applies to every federal duty station in the country that does not sit inside one of the 57 named locality pay areas — and that includes plenty of substantial cities. Being a metropolitan area is not the test. Being a named locality pay area is, and the list is decided by the Federal Salary Council and the President, not by population.

It is also the floor of the whole system: the lowest adjustment there is, and the number every other locality is measured against. When people talk about the size of locality pay, this is the baseline they mean.

That makes this particular comparison the one people run most often, and usually in one direction: an offer in Houston, TX against staying where you are. The salary difference is real. What the table above adds is how much of it survives contact with local prices — which is the part the offer letter does not mention.

One practical warning that applies only to this pairing. Telework and remote arrangements do not automatically keep you on the Rest of U.S. rate, and they do not automatically move you onto a metropolitan one either. Locality follows the official duty station recorded on your paperwork, which is a question for your servicing HR office rather than for a reference site.

What each area covers

Houston, TX is the Houston-The Woodlands, TX area; Rest of U.S. is the Rest of U.S. area Locality follows your duty station, not your home address.

The full Houston-The Woodlands, TX table: every grade and step. The full Rest of U.S. table: every grade and step. To put your own grade and step against either, use the pay calculator.