Gov Careers

By Phil Piemonte

Blog archive

You knew it all along: Compared to contractors, feds are a bargain

Most of you won’t be surprised at this, but in general it costs the federal government a whole lot more to hire contractors to do the same jobs done by federal employees.

Naysayers will be quick to point out that comparisons of federal employees and private-sector employees in comparable jobs do not take into account total compensation—which has become the monster point of contention in this ongoing public pay/private pay debate.

That’s why a good-government group, the Project on Government Oversight, decided to compare total compensation. But it compares three numbers rather than two: full federal annual compensation, full private-sector annual compensation, and … contractor annual billing rates.

Guess what they found?

In some cases, federal workers made more in total annual compensation than their private-sector counterparts.

In other cases, private-sector workers made more in total annual compensation than their federal counterparts.

But in 33 out of the 35 occupational classifications reviewed by POGO, the amount paid out under contractor annual billing rates exceeded the total annual compensation of both feds and private-sector workers. And far more often than not, that amount was a whole lot more .

In fact, POGO found that, on average, contractors may be billing the government about 1.83 times what the government pays feds to perform similar work.

And when it comes to those private-sector workers, the billing rates charged by contractors on average were more than twice the amount private-sector employers pay out for the same services.

In one instance—claims assistance and examining—contractor billing rates were nearly five times more than the full compensation paid to federal employees performing comparable services. In that case, total annual compensation for a fed was $57,292, compared to $75,637 for a private-sector worker, compared to a whopping $276,598 that a contractor would charge to fill that slot.

Moreover, private-sector compensation (to which feds’ salaries are often compared when anti-fed types howl) was lower than contractor billing rates in all 35 occupational classifications POGO reviewed.

If this has whetted your appetite for more information—and ammunition for the next time you hear someone griping about your salary—you can find the report right here.

Happy reading.

Posted by Phil Piemonte on Sep 15, 2011 at 12:13 PM


Featured

  • Contracting
    8 prototypes of the border walls as tweeted by CBP San Diego

    DHS contractors face protests – on the streets

    Tech companies are facing protests internally from workers and externally from activists about doing for government amid controversial policies like "zero tolerance" for illegal immigration.

  • Workforce
    By Mark Van Scyoc Royalty-free stock photo ID: 285175268

    At OPM, Weichert pushes direct hire, pay agent changes

    Margaret Weichert, now acting director of the Office of Personnel Management, is clearing agencies to make direct hires in IT, cyber and other tech fields and is changing pay for specialized occupations.

  • Cloud
    Shutterstock ID ID: 222190471 By wk1003mike

    IBM protests JEDI cloud deal

    As the deadline to submit bids on the Pentagon's $10 billion, 10-year warfighter cloud deal draws near, IBM announced a legal protest.

Stay Connected

FCW Update

Sign up for our newsletter.

I agree to this site's Privacy Policy.