Federal Employees: You’re Not Going Anywhere This Year

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By on June 4, 2017 in Human Resources with 0 Comments

Businessman standing on a walkway looking confused as he faces a split path and tries to decide in which direction to go

If you are one of the nearly 2.2 million civilian employees working for the Federal government, I know something about you. I know that if you are working for the Federal government today, most likely you will still be working for them 12 months from now.

Back in 2016, a survey conducted by the Government Business Council found that 14 percent of Federal workers said they would leave the Federal government and 11 percent said they would “maybe” leave if Trump became president.

So far, that has turned out to be just talk. Pay, benefits, and for some, job satisfaction, keeps you tied to the Federal government.

Quit?

You probably won’t quit.

The quit rate for Federal employees is currently running around one-half of one percent (0.5%), which is still below pre-recession rates of 0.6 – 0.7%. Even if the quit rate for Feds doubled to 1%, that would be less than half the current rate for the private sector (2.4%).

You worry about pay, but the Congressional Budget Office found that unless you have a PhD or professional degree, you are making the same or more money than in private industry, so unless private sector wages increase dramatically, looking for a new, higher-paying job is a non-starter.

If you have a PhD or professional degree, you already knew that your colleagues in private industry made more money and you chose to stay in government, so you are not going to leave for more money because money is not your primary motivating factor anyways.

You won’t be leaving to find a job with better benefits.

Fewer than 10% of private industry workers have a defined benefit retirement plan (like the FERS Basic Benefit Plan), while fewer than half of all private industry workers having access to a defined contribution plan (like TSP), according to the U.S. Bureau of Labor Statistics. CSRS-eligible employees are in even better shape.

Federal workers have employer-provided health insurance, a benefit that is available to fewer than 6 out of 10 private industry employees. When you retire, you will be able to keep your health plan, an increasing rarity in the private sector.

“On average for workers at all education levels, benefits for federal employees cost about $26 per hour worked, whereas benefits for private-sector employees with certain similar observable characteristics cost $18,” according to the CBO.

If you quit, how will you replace all of those benefits?

Retire?

In 2016, almost 94,000 Federal employees retired (less than 4% of the active workforce), and OPM reports that retirement claims this year are running at about the same pace as last year.

About one-third of you are eligible to retire, and there are lots of good reasons to retire, but proposed changes to Federal benefits this year won’t be one of them.

If the current budget proposals are enacted by Congress, FERS employee contributions will increase in 2018 (up 1%) and in future years, but that will be offset by higher pay (a proposed 1.9% increase effective in January 2018).

Eliminating the FERS Supplemental Retirement and stripping the retiree cost-of-living adjustment from FERS (with CSRS retirees receiving a 0.5% reduction in their COLA) will discourage early retirements, especially if you are under age 62 and ineligible for Social Security.

RIF?

Drain the swamp? Not this year.

Proposed cutbacks at EPA have been highlighted in the news, but unless you work for EPA, your chances of getting caught up in a reduction-in-force over the next 12 months is low.

Even in EPA with a worse-case scenario, 3 out of 4 workers are slated to keep their jobs, and EPA’s situation is the exception among large Federal agencies.

While some agencies, such as USDA, have proposed workforce declines in the range of 5 – 6%, once you factor in normal retirement rates, elimination of job vacancies, and possible buyout offers, the actual number of employees facing involuntary separation in most agencies is very low.

At the same time, planned increases at DOD, VA, and the Department of Homeland Security offset most of the cuts in other agencies, so the total number of Federal civilian employees in June 2018 will be roughly the same as today.

Overall, the odds are in your favor, and you have a very good chance of continuing your Federal career, if you wish.

What about 2019?

While Federal government employment in 2017-2018 looks stable, all this could change in FY 2019.

We are still waiting for the President’s reorganization plan; a plan that is subject to Congressional approval, which may be difficult to obtain even with a Republican majority.

Government reorganization might lead to larger layoffs, and the assault on Federal benefits may continue, but none of that is certain right now, if it happens at all.

In the meantime, you can grumble to your co-workers and your spouse, but most of you aren’t going anywhere this year.

For all the complaints about proposed changes to retirement benefits and talk about “draining the swamp”, that’s a secret that the White House and Congress know as well.

© 2019 Michael Wald. All rights reserved. This article may not be reproduced without express written consent from Michael Wald.

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About the Author

Michael Wald is a public affairs consultant and writer based in the Atlanta area. He specializes in topics related to government and labor issues. Prior to his retirement from the U.S. Department of Labor, he served as the agency’s Southeast Regional Director of Public Affairs and Southeast Regional Economist.

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