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Posted at 5:57 PM ET, 12/ 2/2010

The federal pay freeze and recruitment

By Ezra Klein

The view from campus, via an e-mail I received:

I'm a student at the University of Oklahoma. Today the University hosts recruiters for the U.S. State Department who come to campus to talk to students about career opportunities with the department. In addition to the federal government, Chevron, Halliburton, Goldman Sachs, Exxon Mobile and others also have a recruiting presence on campus. If these employers want highly skilled, highly specialized degrees to join their workforce, they've got to be offering attractive salary and benefits.

If a federal agency recruiter hands a student a recruiting packet and says, "Oh, by the way, there's this little matter of a pay freeze," while the private sector recruiters are talking about potential stock options, guess where that student is going to head when he graduates?

By Ezra Klein  | December 2, 2010; 5:57 PM ET
 
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Comments

Well isn't that the idea? You really don't want the best and brightest going to regulatory agencies and the DOJ and other places where they might crimp the plans of the rich to become ever more so.

Posted by: Mimikatz | December 2, 2010 6:00 PM | Report abuse

I can count the number of people on one hand who will be pursuaded to go work for Goldman rather than the Feds on account of the pay freeze.

The federal government primarily attracts people who want to work for the federal government.

People who work at Goldman are willing to nearly kill themselves to earn millions. An extra $1,000/yr from the Federal Government isn't going to be the tipping point for anyone.

Posted by: justin84 | December 2, 2010 6:14 PM | Report abuse

Nonense. A career with the State Department is still worth pursuing on the merits. (Anyone in college now probably won't be employed until the freeze is history.) Besides, if huge paychecks are what the student is after, the federal government is not attractive, freeze or not.

Dan

Posted by: dbuck1 | December 2, 2010 6:18 PM | Report abuse

My "nonsense" comment was to the Mimikatz post.

Dan

Posted by: dbuck1 | December 2, 2010 6:20 PM | Report abuse

I always respect (and usually agree with) Mr. Klein's analysis, but a single anecdote is nearly meaningless in supporting the idea that the pay freeze will affect recruitment. I'd like to see a more substantive piece of evidence that the absence of a 1-2% raise in 10% unemployment will make a noticeable difference.

Posted by: kluhman | December 2, 2010 6:24 PM | Report abuse

I am a fairly well-paid recent college graduate with a degree in Industrial Engineering.

I applied to a lot of government jobs.

I did not receive any calls back from the gov't until I had already been on my job out of college for 3 months, nearly 7 months after I received an offer.

I wonder what the average number of offers students receive these days is? If the gov't is hiring and other employers are not, high caliber candidates will choose the gov't, simply because there are no other jobs.

I have several very talented friends that took jobs with the gov't simply because no one else would give them an offer.

Of course, I feel Uncle Sam is the employer of last resort for these candidates.

Posted by: will12 | December 2, 2010 6:25 PM | Report abuse

actually its Exxon/Mobil, not Exxon/Mobile.


I also despise the thought that EVERY single person hired to private businesses gets stock options. You're obviously overblowing that to try to enforce a point. Facts show that most don't get stock options, unless you're applying for CEO.

Posted by: visionbrkr | December 2, 2010 6:27 PM | Report abuse

People need to shut the freak up about the pay freeze. It was necessary in a world where most taxpayers are getting crunched. It should have happened two years ago, right when all my friends either lost their jobs, got their pay slashed or benefits cut, like worse health insurance or no more matching 401ks. Certainly nobody got any raises. And they still aren't.

Gov't employees are basically the only people left outside of union workers who still get a real pension and retirement, and 80% of them are basically protected from losing their jobs ever. So I'm sick of hearing the complaining. People who live in Washington need to look at the rest of the country and see what's it's like.

Liberals need to wake up and realize the Republicans have formed a united front to crush the President. They are playing a serious game of hard ball while liberals fight in the dugout. At least the President has his eye on the ball.

Posted by: thefoulness | December 2, 2010 6:50 PM | Report abuse

I work at a university just outside the Beltway, and can assure your student correspondent that if he is disregarding government jobs due to the pay freeze, he is in the minority. What stops the Feds from being the employer of choice for some talented graduates is how daunting the process can be. The applications can take months on end and require extensive documentation. Will12's comment is a pretty typical situation. But you can get a private sector job with a smile and a nice interview.

My university, incidentally, has had a pay freeze since 2007. We still have no shortage of applicants, and I've had folks with MAs apply for admin jobs. But our freeze has hurt retention, that much is known. We actually lose a fair number of people to the Feds, at least as far as the non-teaching staff is concerned. All the security, but better pay.

Posted by: stacylane | December 2, 2010 6:50 PM | Report abuse

To the nitpickers, before you start on about the marginal effects of 1-2% freeze, read between the lines a bit.

It's not the 1-2% itself, which is minimal, but rather the general tone toward Federal employment that this action reinforces. Since Reagan, the default view has been that government is "the problem." Politicians are quick to complain when the government misses the mark but are never willing to pay for competence, and on top of that in the last 30 years, it's been outright hostility to government workers, if not even violence. You can generally rely on dedicated people to work for less than they're worth if they deem it a worthy cause, but the hostility negates that dedication.

So it's not the 1-2%, but the "government workers are overpaid and lazy do-nothings" that this action conveys. We all know that the 1-2% is a drop in the bucket financially, so really this ends up just being a "let's all beat up on the Federal workforce" action from Obama so that he can deflect criticism from the White House (or whatever rationalization he has). True believers in the government-is-the-problem mantra have explicitly stated that they want to make government smaller, and making it less effective helps sell that. We're left to assume that either Obama also believes that, or that he's living in some dream world where he just doesn't understand the obvious implications of his actions.

As was said about Bowles' comment that the "government needs to do more with less" and should be reminded here: people tend to do less with less, not more.

Posted by: scotbrad | December 2, 2010 7:04 PM | Report abuse

Really, really silly. Ezra you're an adult now, four or five years out of college. You should understand that there's no competition for recruits between these groups.

Posted by: 54465446 | December 2, 2010 7:09 PM | Report abuse

Also, re: Federal government pensions, there is a LOT of ignorance on this subject out there. While there is still a pension system, it's nowhere near as generous as it used to be for anyone hired after 1984. The plan is now a hybrid 401k/pension plan, and the 401k is not just an add-on as it is in other pension systems. You need to contribute to the 401k if you want anywhere near your previous salary.

http://en.wikipedia.org/wiki/Federal_Employees_Retirement_System

The formula for the pension is 1.1% of your average top 3 salaries times the number of years worked. For a 30-year employee with top-3 salaries of 100k, that's $33k a year. That plus social security will pay the basics and some entertainment, but you're not taking yearly cruises on that. And to get $100k in the government, you likely have a pretty high qualifications set (likely post-graduate degrees or have moved all the way to upper management, but definitely not a TSA screener or administrative assistant).

Posted by: scotbrad | December 2, 2010 7:21 PM | Report abuse

54465446, that's just wrong. There are plenty of people that would like to go into public service but can't because they need a job that can pay them enough to make their student loan payments. It's completely cliche, but true, for talented attorneys to end up at a big law firm for at least a few years because they need the money.

The government may not ever be able to offer comparable salaries, but if you're sitting on $100,000+ debt, knowing that you won't get any raises for at least a few years can have a big impact in your decision making.

Posted by: MosBen | December 2, 2010 7:26 PM | Report abuse

"if huge paychecks are what the student is after, the federal government is not attractive, freeze or not"

What?! That can't be true. Everyone knows that Federal workers make twice as much money as everyone else, and they get free ice cream every day!

But seriously, for everyone who thinks Federal Employees have some "unfair" perks, I once again suggest you get one of these amazing jobs that overpays you and gives you endless benefits:

Here is the link to the Federal government's job site:

http://www.usajobs.opm.gov/

Posted by: Nylund154 | December 2, 2010 7:58 PM | Report abuse

"It's not the 1-2% itself, which is minimal, but rather the general tone toward Federal employment that this action reinforces."

What is your take on the "general tone" toward banks, oil companies and Haliburton?

"The formula for the pension is 1.1% of your average top 3 salaries times the number of years worked. For a 30-year employee with top-3 salaries of 100k, that's $33k a year. That plus social security will pay the basics and some entertainment, but you're not taking yearly cruises on that."

Social Security is ON TOP of that? A person earning $100k will recieve close to the maximum SS benefit.

So let me get this straight. A federal worker can get $33,000/yr, after 30 years (so potentially in their 50s or early sixties).

Depending on when they retire they get another $20,000-$25,000k from Social Security.

So we're already above the median family income in this country.

Then their 401k is on top of that?!?!

The 401k is all most of the people paying for these pensions get!

If this $100k federal worker can find $3k/yr from age 25-65 and earns a 4% return he/she will have $300k in the 401k + the $50k+ pension/SS income stream.

Doesn't sound like a bad deal to me.

Posted by: justin84 | December 2, 2010 8:15 PM | Report abuse

"What?! That can't be true. Everyone knows that Federal workers make twice as much money as everyone else, and they get free ice cream every day!"

Goldman Sachs > Federal Government > Most of the Private Sector

"But seriously, for everyone who thinks Federal Employees have some "unfair" perks, I once again suggest you get one of these amazing jobs that overpays you and gives you endless benefits:"

It's not unfair except that the money is being taken. I don't care what other people make as long as no one is forced upon threats of fines and/or imprisonment to pay them.

Posted by: justin84 | December 2, 2010 8:20 PM | Report abuse

agree with all the others. if you work for the USFG, it's for some combination of the prestige/job security/desire for public service. It's generally not for a couple thousand more dollars (although that may make a difference on the margins for some.)

Also, there's generally loan forgiveness for government jobs if you stay there for a decade or so. I know that's the case for law school.

Posted by: jfcarro | December 2, 2010 10:48 PM | Report abuse

Obama keeps making unforced errors - tax cuts, pay freezes on his base, you name it. "Stick it to the base" Obama needs a primary challenge before he screws up some more. I used to think he was playing 3-dimensional chess, now I realize he can;t even play in 1-dimension. This is the same idiot who squandered a proper health care solution such as a public option. I've given up making excuses for him - let's get him out and ask Hillary or someone else to run in 2012.

Posted by: mark_cohen | December 2, 2010 11:19 PM | Report abuse

We need to replace Obama with a real Democrat before he messes up any further. "Stick it to the base" Obama needs a primary challenge. How I regret supporting him over Hillary.

Posted by: mark_cohen | December 2, 2010 11:21 PM | Report abuse

mosben:

I wasn't talking about government in general but those companies in particular and that email.

Posted by: 54465446 | December 3, 2010 12:06 AM | Report abuse

The student does not understand the real issue looming for new college graduates. Based on a recent MSPB ruling OPM is about to get rid of the best way for a recent college graduate to join the federal service. The government is about to abolish the Career Federal Intern Program which has allowed federal agencies to hire recent bright - mission focused college graduates into the federal service.

Like anything that works well in the federal service it is killed - instead they focus on putting cosmetic changes on the GS hiring system that will not make a difference.

Posted by: john42_20011 | December 3, 2010 7:09 AM | Report abuse

The Federal Government is very good in comparison to many jobs in the private sector. A college grad can enter government as a GS 9 or 10 and make $60,000 to $70,000. I call that a competitive wage and quite good especially in this economy !!!!!!!!

Posted by: Nancianne | December 3, 2010 9:07 AM | Report abuse

As a liberal myself, I must say that I think lib/left reaction to the pay freeze is way overwrought. The average taxpayer thinks its the right thing and what is wrong with the President being on the side of the average taxpayer on his own initiative, not because he had to as a compromise with the GOP. Further, it is not going to affect recruitment. There will still be promotions, merit pay increases and the ability to decide at what initial pay level to bring in a new employee. All that is happening is that in an economy with basically no inflation, there is not going to be an automatic increase in wages just because a year has gone by. Average employees in the private sector by government are living with that and so can public employees.

Posted by: gregspolitics | December 3, 2010 9:53 AM | Report abuse

feds get step *and* inflation raises - the "freeze" impacts just one. they are still fat & happy, low hours, high pay, inviolate security.

@ matk_cohen a big, long wet one for you, buddy! as much as you want!!
we Hilary supporters thought liberal men had gone all sexist with their *vehement* denunciations of her (why??) and their passionate allegiance to Urkel, who resume fit on an index card.
I love, love, love men who note they might have whiffed on passing on Hilary. Slide over closer to me, I have something for you....

Posted by: FloridaChick | December 3, 2010 10:46 AM | Report abuse

------If a federal agency recruiter hands a student a recruiting packet and says, "Oh, by the way, there's this little matter of a pay freeze,"
------

Sounds like a recruiter that really sucks at his job. Well, he does work for the government....

Posted by: ab_13 | December 3, 2010 12:56 PM | Report abuse

To say nothing of the ridiculous forms and application process. How about we stop worrying about recruiting around the pay freeze and start making the process a little less antediluvian?

I won't mention this particular student's typo (ahem). I hope his/her resume has been proofread, and not just spell-checked.

Posted by: ajw_93 | December 3, 2010 2:15 PM | Report abuse

Chevron, Halliburton, Goldman Sachs, Exxon Mobile... and many others who likely also accomplish a large recruiting presence on various campuses... are recipients (even dependents) of huge benefits from the government, which enable much of their piratical acquisitions of wealth.

But it is a mistake to think that paying government regulators more (much less paying ALL government workers more) is any solution: those companies make it a priority to HIRE government regulators... HOWEVER much they are paid by government, industry will always be able to pay them even more.

If you want honest regulation, you will have to address THIS problem... higher wages won't do it.

Posted by: Iconoblaster | December 3, 2010 2:43 PM | Report abuse

im suprised to hear that gs recruits on campus at OU: back office?

hint: back office jobs aren't so lucrative. unless im wrong about recruiting, this student is misrepresenting his/her option tradeoff...

Posted by: stantheman21 | December 3, 2010 10:08 PM | Report abuse

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