Government vs Contracting


by Kofi Annan, VCCS


federal-government-considered-bureaucracy_493a21f86ba7ff73The choice many veterans face when exiting the military is, should they try to work directly for the federal government, or try to become a government contractor instead. A few years ago that choice was easier, because you almost couldn’t lose either way. If you were in the security sector - which many veterans fell into - the government was expanding and by virtue, so did the contracting companies that worked for these respective agencies. Some government agencies literally doubled in size.

The pay gap between the government and the contracting world used to be notably wider, but the government made adjustments to close that gap in order to attract and retain talent. In fact in many cases government employees actually make more. However, the pay versus job-security prism of viewing this topic may be an overly simplistic way of evaluating your options. Trends matter.

When the Great Recession hit 9/11 faded in most people's memories, and consequently government salaries shrunk, bonuses and locality pay increases froze, and direct hiring slowed to meet new objectives. I'm some cases contracting hiring numbers actually remained steady; however the pay shrunk significantly. Contracting companies were asked to hire more workers with less money; so more entry level employees were hired at the expense of the more seasoned ones. Therefore, if money is your primary motivation, neither option might be ideal in this environment.

During the Obama administration the federal civilian workforce shrunk by 14 percent, according to statistics put forth by the Office of Personnel Management. So the bottom line is that when it comes to pay the old adage of ‘rising tides raise all boats’ applies. When the government is doing well contracting companies will as well.

One consistent advantage contractors have over the government is speed. The government remains a bureaucratic behemoth so the hiring and promotion process is slower. Many government positions have time and grade factors that restrict employee promotion potential.

Despite the fact that there are less opportunities available today in either sector, the ones that remain are still good career opportunities with good salaries - even if they're lower than in years past. So the slowdown shouldn’t deter those seeking government or contractor positions.

Determining which route might be the best fit depends on your unique situation. There are no hard fast rules that apply across the board to everyone. Still, trends change over time, so it's important that you remain aware of the national and global political climate. Judging from their political rhetoric, a Trump administration would approach foreign policy, military engagement, and military spending a lot different from a Clinton administration. These approaches theoretically would have drastically different impacts on government hiring trends. Whereas a few years ago Russian analysts and linguists couldn't find work, Russian involvement in Syria has renewed their value and increased their demand.

© Veteran Career Counseling Services, 2016