September - October 2001

Will Government Workers Have to Compete?

The Bush Administration has recently announced plans to change the way the federal workforce is managed and introduce some form of competition between the civil service and the private sector. Details of the package were expected to be released sometime after Labor Day. The White House expects one result to be a major reduction in the workforce and improved management of the entire federal enterprise. The plan calls for a reduction of the workforce (1.8 million employees) through $25,000 employee buyouts, early retirement inducements, and what is being labeled as increased competition between the private sector and federal employees. According to the IEEE-USA Salary & Fringe Benefits Survey, 2001 Edition, 7.1 percent of the more than 230,000 U.S. IEEE members work for the federal government.

The White House package includes recommendations for changing the way government workers are paid. A device labeled "pay banding" will replace the step-by-step advancement routine now in place. Federal managers will be able to award salary increases based on performance rather than longevity.

Spokesmen for government employees say workers are concerned about the plan to increase "competitive sourcing," which translates to putting government jobs up for competition with the private sector.

Office of Personnel Management director Kay James said the Bush objective is not to "shrink" the federal bureaucracy but to "rightsize" it. She did not elaborate on what "rightsize" might mean.

James went on to say that, because of some of the remarks he made on the campaign trail, the President does bear some responsibility for the negative image of federal workers. News stories quoted some campaign rhetoric to the effect that the federal government in Washington (as candidate, Bush "ran" against Washington) is "slow to respond...Slow to reform...At times, the government is irrational, running things without standard…"

James promises to rebuild the workforce and staff it with "the best and brightest…" She wants citizens to see working for the federal government "as a noble calling, back to the tradition of Theodore Roosevelt."

Not surprisingly, government employee union representatives are not enthusiastic about the plan. According to David Schlein of the American Federation of Government Employees, which represents 650,000 government workers, the real problem with the federal workforce is pay. Federal employees' compensation trails private-sector pay. Schlein called "pay banding" a gimmick. Pay structure aside, Congress and the White House have different views about pay increases even now. The Administration favors a 3.6 percent pay increase for 2002 while Congress favors a 4.6 percent raise. Personnel experts say some work needs to be done before deciding on pay increases. The first task will be to analyze how the contract and civilian workforces deliver services. Personnel experts in academia note that reform should include an accounting for the personnel employed by contract and grant organizations that perform services for the federal government. This "shadow" government employs an estimated 8 million workers.

Edith T. Carper is a special correspondent to IEEE-USA Policy Perspectives.