Private contractors cost more than federal workers in 33 of 35 cases, study finds

[FourScore]

Wed Sep 14, 2011 at 07:42 AM PDT
Private contractors cost more than federal workers in 33 of 35 cases, study finds
by Laura Clawson

A new study ( http://www.pogo.org/pogo-files/reports/contract-oversight/bad-business/co-gp-20110913.html )by the Project on Government Oversight (POGO) finds that those overpaid federal government workers we hear so much about actually save the government money compared with private contractors doing the same work:

POGO’s study analyzed the total compensation paid to federal and private sector employees, and annual billing rates for contractor employees across 35 occupational classifications covering over 550 service activities. Our findings were shocking—POGO estimates the government pays billions more annually in taxpayer dollars to hire contractors than it would to hire federal employees to perform comparable services. Specifically, POGO’s study shows that the federal government approves service contract billing rates—deemed fair and reasonable—that pay contractors 1.83 times more than the government pays federal employees in total compensation, and more than 2 times the total compensation paid in the private sector for comparable services.

Additional key findings include:

* Federal government employees were less expensive than contractors in 33 of the 35 occupational classifications POGO reviewed.
* In one instance, contractor billing rates were nearly 5 times more than the full compensation paid to federal employees performing comparable services.
* Private sector compensation was lower than contractor billing rates in all 35 occupational classifications we reviewed.
* The federal government has failed to determine how much money it saves or wastes by outsourcing, insourcing, or retaining services, and has no system for doing so...

MORE AT: http://www.dailykos.com/story/2011/09/14/1016813/-Private-contractors-cost-more-than-federal-workers-in-33-of-35-cases,-study-finds?via=siderec

[SammyWinstonJack]

1. K&R

[SpiralHawk]

2. "Cool. RepubliCon Socialism." - RepubliCorp, Inc. (R)

"Too bad about you smelly taxpaying Americans. Sneer."

- RepubliCorp, Inc. (R)

[DaveJ]

3. Contractors almost always get more than employees

There is this one contractor I know of who makes over $400k per year, plus bonus, plus expenses, and has worked for the company 4 years.

I think they are hired for political reasons. Highly skilled people cannot work for some companies or it would make the less skilled executives look bad.

[SharonAnn]

12. Contracting companies charge more but they often hire less qualified, and lower paid people.

That way, the employer pays more and gets less, too.

You know, "We may be expensive, but we're less competent."

[DaveJ]

13. True in some cases. But there are different kinds of contractors.

The one I was referring to does not go through an agency. She is just classified as a contractor. She actually is a financial systems architect who has brought corporations out of bankruptcy, I don't know if she's worth $225/hr, but still talented. And although people complain about age discrimination, she is in her 60s.

The kind you are referring to are chumps who might show up and do 5 minutes work and charge $200 for a full hour. I see that all the time. (Edit: I say 'chumps' because most do not seem to care about their system of overcharging in connection with their company taking all the profit. I would not want to offend those contractors who are decent nice people though, sorry in advance to them).

[shanti]

4. was there ever any question about this?

:shrug:

[ProgressiveProfessor]

6. Be interesting to compare POGOs methodology against the GAOs

There were some clear error in some of the earlier articles about this

[elleng]

14. Don't know, but

McCaskill lauded POGO's study last night on Rachel show; said she's an auditor, 'does' numbers.

[ProgressiveProfessor]

15. So is the GAO, which is why a compare/contrast would be interesting

When two accountants add up a line of numbers, you should get the same answer. When you do not, that gets interesting.

[ProgressiveProfessor]

5. Prior similar thread

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=439&topic_id=1930176&mesg_id=1930176

[Kingofalldems]

7. K and R for all the little privatizers to read

Including the so-called Blue Dog faction.

[Broderick]

8. But they line the coffers

And that is all that matters it seems.

[Mr Deltoid]

9. Efficiency is not possible with a profit motive

[dtexdem]

10. How about that: funding corporate profits on top of everything else costs more.

Whoda thunkit? ;-)

[Bandit]

11. Republican answer to that is end Davis Bacon......

Lower everyone's standards so the rich can get richer...It is afterall the American way...