Linda Brooks Rix’s Testimony Before the Senate Subcommittee on Oversight of Government Management

Chairman Akaka, Senator Voinovich, Senators, thank you very much for the opportunity to appear before the subcommittee today to speak about recruiting for the Federal workforce.  My name is Linda Rix and I am Co-Chief Executive Officer of Avue Technologies Corporation.  We are a company that provides a native Federal, web-based human capital technology platform to U.S. government agencies.  Most Federal contractors are outsourcing firms; Avue is an insourcing firm.  Outsourcing firms work to transfer work and jobs from Federal employees to outside contractors, usually at more than double the cost.  In contrast, Avue’s expert technology system and service support is specifically designed to enable Federal employees to more effectively and efficiently do their jobs, usually saving agencies 50% per year in the process.   Millions of applicants apply for Federal jobs using Avue every year.  Non-profit employee organizations partner with Avue to ensure a non-discriminatory, merit-based hiring process continues to be supported as hiring becomes increasingly more automated – and that includes supporting Veterans’ Preference.  These organizations include the American Federation of Government Employees, the American Legion, Blacks in Government, the Federal Asian Pacific American Council, and Federally Employed Women to name a few. 

At Avue, we know that technology is an HR force multiplier and have the experience and data to back it.  We believe technology is the best way for the Government to reach diverse and skilled applicant pools.  We believe HR is inherently governmental and the Federal workforce supplying these critical services needs to be strengthened.  We believe Title 5 is an adaptive and relevant personnel system if OPM would maintain the policy structure and invest in keeping policies current. 

The requirement for effective recruitment of candidates for the Federal workforce is urgent.   The Federal Government is an employer of choice for millions of Americans, and the current recession makes putting our citizens to work immediately an absolute necessity.  On top of that, you in the Congress and the Administration have launched what amounts to an “Insourcing Revolution,” a recognition that only by bringing contracted-out jobs back in house can the executive branch make government both effective and affordable.  To achieve these goals, we must reform how we go about the business of reaching out to Americans and filling Federal jobs.  Much has been said over the past 5 years about the upcoming “retirement tsunami”.  In our analysis of Federal workforce trends, we find that the nation need not wait for this theoretical event.  When it comes to Federal hiring, the Government is already under water.  The difference between OPM’s FedScope reported employment totals and GPO-published full-time equivalent (FTE) authorization levels reveals that the Federal sector has been understaffed by between 130,000 to 150,000 authorized and funded positions each year since 2005.  Couple that with the addition of new positions, driven in part by the Recovery Act and in part by key insourcing initiatives, and that number grows to between 230,000 to 380,000 vacancies.  We are already in a “fierce urgency of now” moment. 

Current Federal recruiting capabilities, however, are simply not up to the task of recruiting enough workers to address this shortfall.  Right now, most Federal agencies rely on insufficient business processes and outdated technologies that the leave the vast majority of recruiting and hiring to manual processes.  In the agencies that follow this approach to human resources, their inadequacy becomes evident by considering a single staggering statistic: one human resource FTE in these agencies fills, on average, 10 to 12 jobs per year. 

Several developments have contributed to this low level of HR operational capacity, including a reduction in the total number of HR personnel in the Federal Government at the same time that the demand for HR services has risen, and the tendency of many agencies, encouraged by the previous administration, to seek operational efficiency by relying on centralized service centers for their HR operations.  This factor in particular has contributed to a growing disconnect between the anonymous, distantly located HR worker and the hiring manager they are ostensibly there to serve.   

To address these shortcomings, the Federal sector must take immediate action on three inter-related fronts.  First, it must adopt state of the art technology solutions and allow those solutions to drive the most efficient and effective recruitment and staffing processes.  Second, OPM must reestablish it primary role as a policy setting and leadership body, setting standards, rather than methods or tools, and allowing agencies to operate within these standards in a manner that best supports the agency’s mission.  Third, it must replenish its human resource organizations with highly skilled, innovation-oriented new hires, provide in-depth training and development.  Taken together, these three actions can close the gap between agency capacity and demand for HR services.

I want to emphasize that this task is eminently achievable within the current legal and regulatory framework.  Contrary to the myth that Title 5 keeps agencies from efficiently and effectively hiring the best talent, the facts demonstrate to the contrary.  Together with the Uniform Guidelines on Employee Selection and the Merit System principles, Title 5 ensures a merit-based, non-discriminatory hiring and employment environment that is highly attractive to talented employees and recruits.  Sub-optimal processes are not dictated by this framework, but rather generally attributable to outdated technology and the continued use of time-hardened agency practices that are nowhere to be found in statute or regulation.

For example, Avue’s client agencies raise their HR-to-hiring ratio to more than double the agency average by using open-continuous job announcements that are continuously recruiting a supply of applicants.  The agency electronically reaches out to applicants in the pool every 60 days to ensure the prospective candidates-in-waiting are still interested and available.  Information about their status and the jobs available are pushed to them via email and posted on each applicant’s account for 24x7 lookup.  If the agency is particularly aggressive in recruiting, the announcement will cover all jobs in all locations so that applicants take only minutes to apply to a range of positions in a number of locations.  One Avue client has used this methodology for continuous recruitment over a 7 year period with outstanding results.  By using this process, a list of quality candidates can go forward to the hiring manager in hours rather than months.  Time consuming process steps, like posting each vacancy individually, are eliminated and quality matches between applicant and job, and applicant and hiring manager, are significantly improved. 

In Avue, job postings are broadcast to over 1,600 .org and .edu sites in the Avue recruitment sources library – representing diversity groups, professional associations, colleges and universities, and Federal employee organizations.  That list is refreshed every 60 days.  With the right technology, it is possible to have the best of all worlds in Federal hiring – speed, quality, and a high-touch recruitment process.  On top of all these benefits, the process is extremely economical and allows agencies to spend precious resources on matching the best candidates to jobs and working with hiring managers to conduct high quality candidate interviews, assessments, and selections.

A key issue the Federal Government also needs to address is the overreliance on posting positions to big job boards, especially USAJobs, as a substitute to substantive recruiting programs and meaningful process improvements in the staffing function.  USAJobs is a public notice job posting site, as it is accurately depicted in the proposed Federal Hiring Process Improvement Act.  Meeting the requirements of public notice posting should never be confused with recruitment.  In fact, job boards that aggregate diverse and large numbers of posting on a single site are found by applicants to be confusing and disappointing.  In examining the data for all of the agencies using Avue today, 80% the applicants for Avue agency jobs find the posting by using the common Internet search engines:  AOL, Yahoo, MSN, and Google.  Only 10% of applicants flow from USAJobs – most are already Federal employees – and the remaining 10% are sourced from the agency’s home page.

On average, 61% of the applicants who see an interesting vacancy posted by an Avue client complete the total application process.  In 2008, Avue agencies averaged 45 completed applications per vacancy.  Certain jobs pulled between 700 and 1,100 applications.  Avue agencies use a structured questionnaire rather than KSA essays to complete their applications and only 8% drop at the point at which they are asked to complete this questionnaire.  While much has been said about the “daunting” nature of the Federal hiring process, data show that, in fact, it is possible to keep within the Merit System and Uniform Guidelines on Employee Selection procedures and offer an application process that is simple and easy to use. 

Not surprisingly, applicants prefer sites that are tailored to specific occupations that display key job requirements in a simple form.  Avue presents job search results in a simple table that displays the employer, the location, the salary, and the job title.  Applicants can drill down into specifics from there.  Avue clients use our services to create both custom job portals by occupation, such as acquisition or medical careers, as well as major mission area or hiring initiative, such as hiring for the Stimulus jobs. 

Use of résumés as the principal application process, in an effort to streamline the process, creates a false economy.  Résumé management systems are cumbersome, ill-equipped to return accurate searches, elongate the hiring process, and introduce subjectivity at a level that undermines the merit system, veterans’ preference, and the Uniform Guidelines.  Accepting résumés as an expression of interest still requires processing work that can undermine the efficiency of the process and positive employer-applicant relationships.  While a résumé, in its original form, is an excellent way for applicants to convey their skills, today’s technology requires far less effort – an email address will suffice – and using a simpler method results in a more efficient process. 

Avue agencies need only enter an email address to enter a candidate into a pool of potential recruits – whether the applicant provides it online or the agency inputs it at a job fair.  Avue agency recruitment portals allow applicants to enter their email address and complete a career interest profile.  When these agencies post positions that match that profile, the candidate is automatically notified via email and can enter and apply directly to that position.  Using a structured questionnaire helps applicants understand job requirements without reading cumbersome Federal vacancy announcements full of Fed-speak, and from there they can elect to apply or opt out if the job requirements do not match their skills or meet their needs. 

Technology is also the best way to inform candidates of their status and the status of hiring actions they are interested in as candidates.  In Avue, for example, candidates have 24x7 lookup into the status of their application and where the hiring action is in the process under a self-service section called “Jobs I Have Applied For” which includes a complete history of that candidate’s applications.  Candidates can see where the hiring action is – posted, closed, in review, referred to the hiring manager, etc.  In addition, automatic emails are sent as the hiring process moves forward to all applicants in the process.  The most popular email is the notification sent to both applicants and managers sent 72 hours before a vacancy is scheduled to close.  Applicants who have not completed their applications are encouraged to do so at that time and managers are informed of the aggregate statistics of the applicant pool to encourage the manager to stay engaged.  Constant communication is the key to effective applicant-employer relationships and this is one way to achieve that.”

 Avue pioneered the short job summary vacancy announcement which is the primary announcement used in all Avue electronic postings. The job summary lists key facts – such as salary and location – and major job activities with contact information.  Avue has found that applicants prefer this announcement to the public notice job postings such as those required by OPM.  It would seem that OPM as well should be able to simplify its announcements to make the applicant’s life easier.  I would argue that OPM supports HR staff resistance to adopting a simpler vacancy announcement because they rely on the public notice posting as a means of articulating complex requirements to applicants.  This allows them to avoid direct dealings with applicants, presumably to improve hiring transaction cycle time.  Overreliance on these regulatory postings is extensive and often leads perilously to merit system and other violations. 

As an example, many agencies engage in a practice where notices mandate veterans submit proof documents of military service before their application is considered “complete” and submitted correctly.  This essential requirement, however, is buried in the public notice posting.  If the veteran does not appropriately submit the required documents, their veterans’ preference is not considered.  Agencies have stated that OPM “verbally” approves this practice when OPM regulations require proof documents be delivered only when a job offer is made.  This “we-told-you-so” method of applicant information and relationship management is what technology can change dramatically.  In Avue, candidates are provided information at the time they complete an application specifying the proof documents they will need at the time an offer is made – and it also allows them to attach an unlimited number of documents to their core application, which can be reused every time they apply.

This combination of modern technology and carefully crafted business processes is the indispensable key to effective Federal recruiting, as well as hiring, staffing, and the entire range of human resources operations.  Despite this fact, agencies have sought to find shortcuts to success to avoid this necessary approach.  For example, to accelerate the filling of positions, agencies often resort to the use of hiring “flexibilities” as a stopgap measure to fill positions quickly.  An overlooked consequence of this particular shortcut, however, is the unintended consequence of eroding the core career civil service.  In fact, of the new Federal hires made each year, only 25% are in the critical category of Career and Career-Conditional appointments, the backbone of the Civil Service.  The quit rate of Federal Career and Career-Conditional workers exceeds the replenishment rate by an average of 37,000 employees per year for the past 5 years.  On average, only 25% of all new hires are in the Career and Career-Conditional category.  As “flexibilities” are used more frequently, the workforce becomes increasingly more transient and the long-term benefits of Federal employment are given to fewer and fewer new hires.  As a result, retention has become a bigger and bigger problem as applicants realize that they have a job but not a career and that career ladders, promotions, training, development, and benefits are all truncated as a result.   This impacts the government’s ability to assure continuity, respond to crises and national emergencies with agility, and maintain an orderly transition across Administrations.  Of course, new employees will need to be hired to replace this lost talent, thereby exacerbating the government challenge with recruitment.

OPM itself has suffered from decreasing HR resources.   Today, only 7.5% of OPM’s own workforce is in the human resources occupation.  This has led to a severe deficit of published policies upon which all staffing in Government relies, namely qualification standards.  Even agencies with alternative personnel systems, like pay banding, rely on these Title 5 standards.  Only OPM can issue these standards and agencies are mandated to use them.  In the last decade, OPM has issued 90% fewer classification and qualification standard than in each of the previous two decades.  Of those that have been issued, the changes made are cosmetic and offer little process improvement or labor market relevance.  Given the amount of reporting and workforce planning data agencies are required to submit to OPM, we believe OPM should be tasked with conducting substantive occupational studies and improve these standards so they are relevant to the skills available in the labor market and the workforce needs of Federal agencies. 

Frustrated by their internal processes, many agencies have mistakenly turned to outsourcing HR to contractors, many without any expertise in Federal HR, bogging the hiring process down further.  In addition, of course, the cost to government of outsourced HR work is consistently two and one half to five times greater than when performed by Federal employees.  Avue believes that human resources is an inherently governmental function and that outsourcing the key relationship between management and its human resources professionals produces a dysfunctional human capital management program.  Unfortunately, the biggest advocate for outsourcing HR in the recent past has been OPM.  Its TMA contracting vehicle allows Federal agencies to outsource HR functions to OPM and OPM, in turn, funnels the funding and work to a cadre of allegedly “approved” contractors, thus bypassing procurement and A-76 competitions.  This contract vehicle is a significant source of revenue netting more than $200 million per year.

Finally, we believe that if OPM is to be an active player in providing solutions to the significant challenges facing Federal hiring, it must be required to exit the fee for service business that currently represents over 70% of its funding and 70% of its staff, and return to its core mission.  OPM cannot be viewed as an “on the merits” neutral for Federal agencies under these circumstances, especially when it is known, for example, to use its audit authority to ensure sales of its outdated USAStaffing software to the very agencies it regulates, or to be widely known as using its fee-based “TMA” contract to help agencies get around applicable competition and outsourcing regulations in exchange for contract fees of 6-12%.

All of this underscores the importance of the work of this Subcommittee and its efforts to improve the processes that underlie the policies we apply to the Federal workforce.  Efforts made to improve the hiring process, both in terms of the applicant experience and process improvements are essential at this time.  HR operations staffs throughout government rely on the combined elements of regulation, oversight, technology, and permissions to produce change.  Right now, the regulations need updating and revision, the oversight needs to return in a meaningful way, technology needs to be embraced as the most cost effective means of recruitment as well as applicant relationship management, and HR leadership need to be given overt permission to adopt innovation and change business processes to achieve the right results.  The work of this Subcommittee could not be more timely.  Change is made possible when the people operating the business process are given permission to seek it and oversight bodies reward those who are getting the right result.  Encouragement by providing guidance and permission are key to starting the process.  More work will be needed, and much of it in the form of new policies and standards issued by OPM.  We hope you will move forward with supporting, if not mandating, such change.