Rebuilding the Federal Workforce

Government needs to rebuild its workforce. To use Don Kettl’s words, “There’s a huge crisis afoot—and, make no mistake, the merit system is in deep and profound crisis. The historic system for hiring and promoting federal employees is failing the nation, and the consequences are profound.” The point has been made repeatedly—the workforce is aging and “new blood” is needed to address the nation’s increasingly serious problems.

In 2001, when George Bush was inaugurated, 18% of the workforce was age 55 or older. Today 29% are in that age group. Less than 8% are under age 30. Significantly, the average age of employees in STEM (science, technology, engineering, and medicine) occupations is somewhat older. 

The pandemic response triggered a new focus on expertise but it also makes the future of how people will work together uncertain. The revamping of working relationships and new focus on individual skills opens the door to empowering employees and rethinking government’s management paradigm.

Staffing problems have been discussed for years. A search of the phrase “hiring process” on Government Executive returns 5,300 stories and columns. The Trump administration tweaked the process but the changes did not address a core concern—government’s civil service policies and practices are not competitive.

John Kamensky posed the key question recently: “Suddenly, the conversation about telework has shifted from ‘Do we have the right technologies in place?’ to ‘Do we have the right people policies and training in place?” When government’s people policies and practices—the civil service system—are compared with the best thinking in high performance organizations, the answer clearly is no. 

Wanted and Needed: Top Talent

Unemployment levels remain high but the people who lost jobs this year are concentrated in occupations that are not found in high numbers on government payrolls. Bureau of Labor Statistics data for 2019 (the most recent) shows the country’s workforce in the STEM fields has increased since 2016. Over 300,000 workers were added in technology fields; employment increased in engineering fields by roughly 100,000; and increases occurred in the science fields. More significantly, unemployment rates for STEM and other knowledge specialists are among the lowest. The best specialists can choose from multiple job offers.

Companies are still hiring in high demand fields. To illustrate, Glassdoor, one of the country’s more prominent recruiting sites, lists 797 cybersecurity openings in Chicago and 585 for civil engineers. For Washington, D.C., the website currently lists over 3,000 jobs for Technology Specialists. 

Before the pandemic, it was estimated the shortage of college-educated workers in North America and Europe would be 16 million to 18 million in 2020. While the pandemic has temporarily altered company hiring plans, the shortages reflect demographic trends. The Biden administration needs to look to the future and develop plans to add needed skills. However, that may be difficult until government improves its brand as an employer. President elect Biden took an initial step when he promised to raise salaries.

Focusing on the numbers suggests staff planning looks narrowly at head counts. A quote in a McKinsey article credited to Steve Jobs, Apple’s co-founder, highlights a different strategy: “Go after the cream of the cream. A small team of A+ players can run circles around a giant team of B and C players.” It reminds me of a client that decided to pay new engineering graduates at the 90th percentile to support recruiting the country’s best.

McKinsey research shows “high performers are 400% more productive than average ones. In highly complex occupations [that refers to the difficulty of problems] high performers are an astounding 800% more productive.” Better results fully justifies switching to practices proven to attract the best talent. It can actually save money if fewer specialists are needed.

The most contentious practice is salary management. Naturally, high performers want to have their value recognized. In other sectors, they command higher pay levels. Holding down salaries to control costs is not the answer. It diminishes employee commitment and performance.

President-elect Biden has promised to “listen to the scientists.” The pandemic highlights the importance of their expertise. But the need for experts extends well beyond the current health crisis. The problems confronting the country—social inequity, cybersecurity, terrorism, climate, the list is long—are far more complex and difficult than those affecting the typical company. Experts like Dr. Anthony Fauci are needed across government. But they need to be empowered to fully apply their expertise.

That is not a new argument although public reports suggest it was not a priority in the Trump administration. If President Biden were to invite new graduates to play a role in tackling the country’s problems, as President Kennedy did in his inaugural speech, it would be important to recruiting.

It Starts with Planning

Workforce planning is another topic that has been discussed repeatedly. A 2019 Government Accountability Office audit of the Internal Revenue Service identified HR problems that are likely to be concerns in other agencies:

“Human resources at IRS is now almost exclusively engaged in transactional work,” GAO said, rather than any proactive planning. “Activities such as identifying skills gaps and attrition forecasting have taken place on a fragmented basis throughout the agency, leaving the IRS without a comprehensive picture of its needs. The agency told GAO it did not know where its skills gaps are, as it has not used any workforce planning in recent years.”

That’s a problem. Rebuilding the workforce starts with documenting the vacancies by job series and location. Basic workforce analytics can help to identify employees likely to retire or resign in the near future. Developing multi-year plans assists managers and helps employees see their futures.

Beyond that, agencies should identify skills gaps, including those newly emphasized but hard to assess soft skills. Senior professionals should be asked to identify the core competencies at each career stage.

Early in Tennessee’s successful reform, the state’s Human Resource Commissioner, Rebecca Hunter, joined with the lieutenant governor on a listening tour to understand the state’s workforce problems. That would be a productive strategy early in the Biden administration. Local managers and employees understand the problems better than anyone. They want to see problems solved. Involving them in the planning is key to securing their support for change.

A missing element is credible data on starting salaries for new graduates. Strangely, that has not been a consideration in adjusting GS salary ranges. Monitoring starting salaries is universal in other sectors. Bureau of Labor Statistics data, however, are not helpful. The National Association of Colleges and Employers collects limited starting salary data. A number of private sector surveys also collect the data. 

Starting salaries are governed by the balance of supply and demand for talent, and with high unemployment for lower skill occupations, the larger increases in high demand fields are no doubt pulling knowledge jobs ahead. The rigid General Schedule is a handicap in competing for talent.

Notably, this month the Securities & Exchange Commission issued a new disclosure rule requiring companies to include human capital information relevant to understanding how those policies and practices affect the business. Agencies should comply with the rule. 

Focusing on An Agency’s EVP

It has been reported that agencies are experiencing early turnover of new hires. That will undermine efforts to rebuild the workforce. If the turnover reports are accurate, addressing the problem should be a priority. There is a mountain of research on the practices important to young employees and known to contribute to building a committed, high performance workforce.

The phrase “employee value proposition” or EVP is used to refer to what employees consider when they evaluate job opportunities. It includes pay and benefits, support for development, along with softer considerations like trust and respect, team spirit, and morale of co-workers. Recognition and reward practices are core concerns. Gallup’s research highlights the importance of supervisory practices. Glassdoor analyzed the comments made by employees about their jobs and found low pay, poor upper management, and long hours are the most common complaints. 

Losing new hires early is costly. The hours invested in their selection and training, and the lost productivity while they were learning is a sunk cost. Possibly more important, their resignations are reflected in an employer’s brand and can deter future job candidates. An agency’s mission is important to many job seekers but if they become dissatisfied, they have other opportunities where they will find a better EVP. Assessing the problem is easy—ask new hires what’s causing their dissatisfaction.

Leaders Have to Make It Happen

While President-elect Biden is assembling his team, rebuilding the workforce can be planned and undertaken as a backroom, primarily HR initiative. A starting point might be a review of the 150+ reports the Government Accountability Office issued on human capital concerns in the past year. Human capital management has been on GAO’s high risk list for two decades. Agency human capital officers need to be assertive in pushing to replace ineffective practices.

But none of this can happen if it’s not a high level organizational priority. In three frequently mentioned reform stories—China Lake, GAO and the state of Tennessee—leaders were strong advocates for change. GAO’s David Walker argues, “Transformation starts at the top. The CEO needs to ‘build a burning platform’, provide a ‘call to action’, and show ‘a way forward.’” 

Walker recently said, “We made our people priority No. 1.” Throughout GAO’s reform, an Employee Advisory Council played a role in the planning. The agency made extensive changes in its human capital practices, and the result was “the agency more than doubled its productivity.” It has been second on the list of the best places to work in government for a decade. The game plan could produce positive change in any agency.

The website of the Biden transition team, buildbackbetter.com, suggests they will be looking for ways to improve the functioning of government. Rebuilding the workforce and renewing employee commitment will be important to the new administration’s success.