One of the proposals to pay for payroll tax extension is to freeze federal hiring. Under this proposal, the government could only fill one out of every three jobs that is vacated. The main (only?) benefit of reducing the workforce is that no one gets fired. It always sounds better to just not fill a position than it does to fire someone. But, if your goal is to get a better government that works more efficiently, then it is a horrible plan.
(1) It doesn’t technically save any money. Sure, having fewer employees does actually save money because you are not paying for salary and benefits etc. But, unless you institute a mechanism to allocate these savings, then it won’t save the government money.
Let’s say you work for the Department of Education as a project manager on the Race to the Top Initiative which is funded with $1 Billion dollars (all figures made up). You leave your job to go do something and the Department decides not to fill your position. They save $60,000 in salary and benefits, which remains in the Race to the Top account. Unless that money is specifically pulled out of the account, then it will be available on the books in August and September. And what happens every August and September? The budget people try to spend every last dollar in the account (otherwise we will get a smaller budget next year). So, they will still spend that $60,000 and even though there are fewer employees, no money will be saved.
(BTW, if you don’t think this is exactly how it will happen, then you have never worked for the government.)
(2) What about contractors? Thirty years ago, everyone who worked for the government worked for the government. Sure, there were defense contractors making planes and guns and stuff. But, if you walked into a government building everyday, you were employed by Uncle Sam. Following the contracting splurges of the 1990s and 2000s, most of the government work force doesn’t work for the government. (I don’t have actual figures and I am too lazy to search for them).
Simply reducing the number of federal workers is not going to help anything if we just turn around and hire a contractor to do the same work. In order for a hiring freeze to be effective, you’d also need to look at freezing government contracts, or at least putting them under a stricter review process. But this will never happen. So, positions that are eliminated (like the Race to the Top project manager above) will simply be contracted out.
(3) One-third of the workforce is exempted. Under the proposed legislation, jobs related to national security may exempted by the President from the one in three rehire rule. So, approximately 700,000 of the 2 million federal positions are likely to be exempted from the rule anyway.
(4) Government would lose the best employees. In this economy (I hate this phrase), who is leaving government service? People who get better jobs elsewhere. And who is most likely to get a better job elsewhere - the most qualified employees. So, the government will be losing their best employees and have more difficulty replacing them with qualified applicants. The average quality of employee will go down.
(5) The worst employees would not lose their jobs. The corollary of (4) is that the worst employees will keep their jobs. They are not going anywhere and now we are relying on them to do their work and more. The quality of federal employee will go down.
So, what is the solution? I will be the first to admit that there is waste in government employment. In my old job at the Coast Guard, our office was overstaffed for ten months out of the year (August and September were busy). My position was absolutely one that could have been eliminated. But, under the proposed plan, the only way they’d eliminate my position is if I quit, it is not related to national security (which it was), and it was not the one out of the three positions that got filled.
If you really want to eliminate 10% of the federal work force, you need to have a Reduction In Force (RIF). No one likes RIFs because it means people get laid off. It forces supervisors to make difficult decisions and to fire people. It destroys morale in an office. But, it also allows supervisors to get rid of the worst employees (or at least the ones they like the least). Rather than losing the people you can least afford to lose, agencies get to choose who stays and who goes.