Some fed contractor salaries rise, most fall

Salaries for some federal contracting jobs are rising, but many are not, according to a survey released today by the Professional Services Council and the Human Resource Association of the National Capital Area.

According to the survey, contractor salaries increased an average of 3.53 percent between 2004 and 2005. However, only 19 of the surveyed job categories actually saw pay increases, while pay rates fell for 82 other categories, said Alan Chvotkin, the council’s senior vice president and counsel.

Meanwhile, the average pay for federal government employees increased by 4.58 percent, according to the survey. At all levels except executives, federal employees earn an average of 1.26 percent more than contractor employees, the survey showed. Contractor executives, however, are paid an average of 36.5 percent more than their public-sector counterparts.

Chvotkin said some of the general upturn in salaries for contractors comes because government agencies are increasingly contracting for professional services. "There is unquestionably greater competition for those dollars," which translates into competition for qualified employees, he said, and hence potentially higher pay.

Chvotkin cautioned that the survey has weaknesses. It was compiled from data that the Human Resource Association gathered as part of a survey of employment generally in the Washington, D.C., area. Because the survey uses a subset of that data, it includes only 92 of the 347 organizations that responded to the larger survey, and only 279 of the 311 job categories represented there.

Also, the council defined a "government contractor" as a company that gets at least half of its revenue from government contracts. "To an extent, we are understating the federal contracting market," he said, because many companies have significant federal business that does not reach the 50 percent threshold.

Next year, Chvotkin said, the council plans to conduct a survey of the effect that security clearances have on employee salaries. That is the hottest topic right now among the council’s member companies, he said.