GAO can't solve the 'who's cheaper' debate

The Government Accountability Office’s new in-depth report analyzing pay for public and private sector workers doesn’t bring any clarity to the never-ending debate  over who’s the better deal for a cash-strapped government: contractors or federal employees.

Only Congress or the White House can settle that debate, Scott Amey, general counsel for the Project on Government Oversight, wrote on the POGO Blog July 25. The debate can end with a study that compares the public sector, the private sector, and government contractors’ total compensation and all associated costs.

“A comparison of federal and private sector pay doesn’t do anything to help contribute to the government’s decisions to insource or outsource work,” he wrote.

It also doesn't do anything to help settle the argument over whether feds are overpaid compared to the private sector, which surfaces periodically when Congress considers legislation to freeze or cut federal salaries as suggested deficit-slashing measures. GAO released a 66-page report July 23 that delves deeply into General Schedule pay and its comparison to the private sector. However, any comparison of government and contractor employee costs was outside the scope of its work.

GAO analyzed six studies. One, for example, was from POGO and another was from the Heritage Foundation. But the studies all came to different conclusions about which sector had the higher pay and the size of the disparities. They each took different approaches and used different methods and different data. Thus, their interpretations were not the same.

To say the least, the title of the report says it all: “Federal Workers: Results of Studies on Federal Pay Varied Due to Differing Methodologies.”

A true evaluation needs a job-to-job, skill-to-skill perspective, Amey wrote both in the blog and in a letter in response to GAO after reviewing the draft report, which was included in GAO’s final report.

“No one will really know the truth until uniform systems are created and apples-to-apples comparisons are conducted that factor in comparable skills, work experience, education, and other non-pay factors,” he wrote in his blog post.

About the Author

Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.

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Reader comments

Tue, Jul 31, 2012

Those that know they are overpaid argue that they are underpaid. Those that know they are underpaid, argue that they are underpaid. As I said before, you can't group all these occupations together to do an analysis. Engineering as an example: it is widely known that civil engineers, in general, are paid less than most other engineering degrees yet the feds group all engineers together making it good for civils and bad for electrical. Annual salaries in the private world have consistently shown about 25% higher earning difference from EE's than civils yet they are still grouped together with the feds. So we are left with good civil engineers for the most part and not so good electricals. Frankly, I have had enough of my only federal position (not based on pay) but on how many people are running around, clueless, trying to justify their job and the favoritism that occurs and lack of accountability in support positions. I say it is similar to going back to high school and trying to be the most popular in school except now were all supposed to be adults.

Tue, Jul 31, 2012

Contracted work does not save a dime. In fact, it probably costs more, in general. Contracts require a contracting office, contracting officer representative, safety personnel, inspector and usually an engineer. Where as government doing the work requires an engineer and some craft personnel to carry out the work. Contracts move even slower than the government by itself because its bogged down by all CO's, COR's, inspectors. There is a strict chain of command and communications typically have to go through at least 4 channels to make decisions - keeping in mind that the only person in this loop that has any sort of accountability placed on them is the engineer - the CO's and COR's and inspectors are not held accountable for the projects success or failure and their actions and delays in making decisions reflect this. Contracting work is sometimes required but often at a much higher cost and certainly much longer duration.

Mon, Jul 30, 2012

Does it really matter? It’s all about politics. If the costs are close enough for confusion the savings are negligible. The dollars saved are a drop in the bucket compared to the trillions spent on incentives and bailouts. Penny wise and pound foolish. The only place real savings can be had is in health and human services. Those items are hard to change and political dynamite. It wasn't civil servants who got us into this mess.

Fri, Jul 27, 2012 StephenJ Indiana

The answer is fairly obvious: fed workers in highly skilled positions make less than their counterparts in private industry. Fed workers in less skilled positions make more. Even though I am a career civil servant (engineer), the answer to the question doesn't matter that much, because the federal government is drowning in trillions of dollars of debt. Since spending is roughly 200% of revenue right now, federal workers are an easy target for politicians who have made it a priority to cut the deficit. Politicians who cut fed benefits while avoiding tax increases and other cuts get re-elected. Politicians who fight for fed benefits and suggest a multitude of other cuts or tax increases end up angering the large majority of their constituents. Those politicians do not get re-elected.

Thu, Jul 26, 2012 David Arlington, VA

One huge factor that these types of analyses always miss is that contractor productivity is directly tied to the competence of the Federal managers that oversee their work. Contractor companies don't often care about productivity unless the Fed manager makes them care. They're driven by revenue, utilization rates, and of course contract profit. They only need to appear to be productive to win the follow-on contract. For many projects, I find that contractors--given realistic goals and resources--will outperform Feds. On other projects, with vague goals or inadequate resources, millions of dollars get flushed down the toilet. So comparing personnel compensation rates is a fool's errand done to score political points.

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