The General Schedule system is unresponsive to labor market dynamics and agency staffing needs.
Take a look at this old report written by the Office of Personnel Management in 2002 titled “A Fresh Start for Federal Pay: The Case for Modernization”. It was written based on conversations and feedback collected by many key personnel over 3 years. However, it’s distressing to note how many critical concerns voiced in this report are yet to be addressed effectively.
There were 6 reasons given by the authors as to why the existing pay system wasn’t of much use to federal employees.
• “The government requires the leaders of different agencies to overcome unprecedented and new management challenges while retaining an outdated pay system. The job descriptions are largely antiquated and not meaningful in light of today’s knowledge-oriented organizations.” – Many class standards have not received any meaningful updates to this date.
• “The existing pay system doesn’t reflect current market compensation levels. Locality adjustments and pay hikes are all based on a costly and cumbersome measurement system, which isn’t relevant anymore” – The general schedule system doesn’t have any credibility and is not rooted in reality.
• “There is minimal encouragement for individuals who display consistent results and achievements. Over 75% of the pay hike has nothing to do with individual competence or achievement.” – These ratings happen to be badly inflated as well.
• “The current structure was designed for a workforce belonging to the 1950s and is vastly inefficient by today’s standards. Back in 1950, 75% of feds belonged to Grade GS-7 or below. However, this percentage has fallen below 30% in 2002.” – Given the overarching presence of technology and cyberspace in every government agency, the present structure is ridiculously outdated for 2020.
• “The prescribed practices and procedures prevent agencies from customizing their pay programs based on labor markets and the importance of missions. It’s highly unlikely that one single structure system will suffice to determine the pay for positions in different federal agencies like the CDC, Finance and Accounting Service, Defense Department, Social Security Administration, and National Weather Service, which all require varying levels of competence and qualification.” – The coronavirus pandemic has added another dynamic to the staffing process as well.
• “The General Schedule system has begun disintegrating, thanks to the special rate authority, which has allowed many agencies to move towards modern systems. Common policies cannot be promoted across the entire government due to their inefficiencies.” – The number of locations and jobs that are being paid for under the special rate authority has also mushroomed massively in the last few years.
Salaries for federal employees are much lower compared to their counterparts in the private sector. Neither the OPM nor the Bureau of Labor Statistics take competitive pay levels into consideration while determining pay hikes, which have now become increasingly politicized over the last few decades.
However, calls have been made in recent times to overall the pay system. The National Commission on Military, National, and Public Service produced a new report in March, where it argued for measures to be taken that would make the government an attractive employer. They called for the federal personnel system to be replaced with a better alternative that would help agencies replenish their dwindling workforce with young workers and Americans with important skills.
