Report: Insourcing government work could be disasterous

A report says the Obama administation should be careful before taking jobs from contractors and giving them to agencies

The Obama administration and Congress should proceed cautiously as they attempt to take work away from contractors and hand it to agencies' employees, according to a report released June 10.

“A rush to insource thousands of positions, while trying to take on ever more government programs, can end in disaster,” wrote Raj Sharma, president of the Federal Acquisition Innovation and Reform Institute, in a report titled "The Move to 'Insourcing'…Proceed with Caution."

Agencies should concentrate first on removing contractors from jobs already defined as inherently governmental and duties central to agencies’ missions, the report states. At the same time, officials need to consider insourcing other jobs in longer-term phases, he wrote, adding that the government can handle the shifting load much easier in stages rather than all at once.

“Rushing to undo what has been in the making for years — perhaps decades — will be counterproductive,” Sharma wrote.

Moreover, taking work from contractors must be done deliberately and based on facts, not innuendo and rhetoric, he wrote.

President Barack Obama often depicts contractors as taking advantage of the government.

However, contractors are a major component of how the government operates, Sharma said, and they often perform work that requires specialized expertise.

“The current rhetoric that demonizes all contractors, instead of those few that are guilty of fraud and abuse, will only deter the best suppliers that we so badly need from competing for government business,” he wrote.

He added that an essential component of success for Obama’s plans for health care reform, energy independence and social innovation will be the technical expertise, innovation and scale that industry can bring.

Meanwhile, experts say experienced federal employees are attractive to private-sector companies, which often offer more to those employees than the government does. Also, a large number of government employees are nearing retirement, and agencies’ acquisition jobs are remaining vacant because few people are seeking those jobs.

Obama’s calls to join public service can only do so much to help find people to do the work, Sharma wrote. The government needs to reconsider its recruiting efforts, pay and professional development policies to make them competitive with the private sector before agencies dramatically insource jobs.

“While it may be feasible to hire thousands of people during the current economic downturn, it will be difficult to retain this talent unless systemic human-capital issues are addressed,” he wrote.

Sharma said officials should answer the following questions before bringing work in-house:

  • Which positions should be insourced?
  • How and when should they be insourced?
  • What will attract the people needed to do the jobs once they are brought in-house?
  • How will the government retain the employees who are doing the insourced jobs?

Reader Comments

Sun, Nov 15, 2009

If the work has been outsourced for many years, it is not a case of using the contractor as a recruiting agency. On the other sideof that coin, when initially outsourced, the contractor often gets to pick from employees trained by the government. In Dod, the contractor continues to benefit by hiring ex-military already trained at publc expense. I support insourcing because the employee usually gains an excellent benefit package. I have seen many contract employees lose benefits each time the contract is rebid. Due to competition, bidders must go lower each time to win. The cuts are usually in labor costs. The number of employees is reduced, along with health care, life insurance and retirement plans. In fact, retirement plans have been reduced to almost nothing. Civil service also offers the opportunity to relocate and advance. A young employee will be far better off under civil service.

Mon, Nov 2, 2009

In response to the comment posted on June 15th, simply taking "the best of contract employee" is wrong on so many levels. The employee will usually have a non solicitation or non compete or conflict of interest clause in their employment package which would restrict their ability to work for the customer doing the same work anyways. It is a conflict of interest for the government to issue a contract to an organization, the organization spend resources to fill the contracted position, and then solicit the employee to turn them Civilian. It is a huge infringement of trust. If all the Government wants is a recruiting agency, then that is what they should pay for, not take an organization's employees just because it is convenient for them.

Tue, Jul 14, 2009

As one of those evil, lazy, overpaid contractors who actually does the work while 3 civilians who "supervise me" sit around chatting, I can assure you that the current civilian workforce doesn't have the highly technical skills to do my job simply because the government does not do the training required to keep them up to date. Their technical skills stagnated the day they were hired, often decades ago. It's easy to say they'll just flip our badges, but naive. In my department (which is on the chopping block to be in-sourced, we just don't know how bad yet) NONE of my contractor co-workers said they wanted to become civilians, and would only transition if they couldn't find a job elsewhere. Since we all have high demand IT skills, the government will absolutely lose the best workers and doesn't have the personnel procedures in place to retain tech workers or hire well qualified ones. To fix this problem requires a lot more than simply deciding it would be nifty to have more civilians. I requires radical institutional changes.

Mon, Jun 15, 2009

It would not be disaster for the government just hire, the best of contract employee, from on site manager recommendation and returnning military. they do the same job now!!!!! how easy is that, the person say it would be disaster for the government need to take there head out of the SAND!!!

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