Contractors vs. staff: You do the math
The latest phase of the debate about the role of contractors in government shows that even the obvious is less obvious than it seems
Whether the pendulum is swinging toward outsourcing, circa 2001, or insourcing, as it is now, any measurable change in motion is sure to stir up a debate about the appropriate role of contractors in government.
The debate is often framed in terms of determining which jobs are inherently governmental. That’s why a recent Washington Post article about the essential role of contractors in the intelligence community caused such commotion. Here, if nowhere else, the line between government and contractor responsibilities ought to be clearly drawn.
Alas, the ensuing debate showed that even intelligence work leaves room for debate. Additionally, the pendulum’s present direction — toward replacing contractor positions with staff employees — is complicated by growing concerns about the federal deficit. By insourcing jobs, are federal agencies saving money or simply adding more red ink?
Our coverage of the controversy generated a lot of debate at FCW.com. Here is a small sampling of the comments we received, edited for length, style and clarity.
Pay vs. Profit
I know of contract positions where the company is paid more than $300,000 per year — far more than any government employee makes. But the contract employee only gets perhaps $60,000, and the company pockets the rest in profits. The important point is how much the government pays for the position, not how much the incumbent takes home.
Pay vs. Responsibility
The problem with the government pay system is that it treats all employees, regardless of skill set or responsibilities, as the same in terms of pay. Let's be honest, an administrative assistant generally has fewer responsibilities than a senior manager who he or she supports or reports to. Yet a GS-15 makes the same regardless of position, title, responsibilities or accountability. The government needs to get serious about matching salaries to skill sets and rewarding performers and sanctioning poor performers.
Basic rules of contracting from the private sector: You hire a subcontractor when (a) you don't have the knowledge or the skill in-house to do a job yourself; or (b) you don't have the time, in the form of man-hours, to do it yourself. If you don't have the skill and you need that skill for a limited amount of time and for a unique or singular project, you hire a contractor. If you are going to be handling the same type of work for more than six months and/or there appears to be a lot of repeat business that obviously justifies a full-time employee’s position, then you had better hire someone to do that job.
Contractors are necessary due to how difficult it is to hire and fire government employees. Contractors are perfect for filling needs because you can eliminate them when the need is gone. Signing on a government contractor is like a lifelong contract. If the government would make it easier to hire and fire without making it the longest, most drawn out political process in the world, then the need for contractors wouldn't be there.