oversight

Human Capital: Opportunities to Improve Executive Agencies' Hiring Processes

Published by the Government Accountability Office on 2003-05-30.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

             United States General Accounting Office

GAO          Report to Congressional Requesters




May 2003
             HUMAN CAPITAL
             Opportunities to
             Improve Executive
             Agencies’ Hiring
             Processes




GAO-03-450
             a
                                               May 2003


                                               HUMAN CAPITAL

                                               Opportunities to Improve Executive
Highlights of GAO-03-450, a report to          Agencies’ Hiring Processes
congressional requesters.




Improving the federal hiring                   There is widespread recognition that the current federal hiring process all too
process is critical, as the number of          often does not meet the needs of agencies in achieving their missions, managers
new hires is expected to increase              in filling positions with the right talent, and applicants for a timely, efficient,
substantially. Federal agencies are            transparent, and merit-based process. Numerous studies over the past decade
responsible for their hiring                   have noted problems with the federal hiring process. Nearly all of the federal
processes, but must generally                  human resource directors from the 24 largest federal agencies told us that it
comply with applicable Office of               takes too long to hire quality employees. According to data compiled by OPM,
Personnel Management (OPM)                     the estimated time to fill a competitive service position was typically more than
rules and regulations.                         3 months, with some human resources directors citing examples of hiring delays
                                               exceeding 6 months. The competitive hiring process is hampered by inefficient
Congressional requesters asked                 or ineffective practices, including defining a vacant job and pay that is bound by
GAO to identify federal hiring                 narrow federal classification standards, unclear job announcements, the quality
obstacles, provide examples of                 of certain applicant assessment tools, time-consuming panels to evaluate
innovative hiring practices, and
                                               applicants, and the “rule of three” that limits selecting managers choice of
identify opportunities for
                                               candidates. Equally important, agencies need to develop their hiring systems
improvement. To address these
                                               using a strategic and results-oriented approach.
issues, GAO interviewed the human
resources directors in 24 largest
departments and agencies,                      GAO studied five agencies that human capital experts identified as having taken
analyzed the hiring practices of five          steps to improve parts of the hiring process—the U.S. Geological Survey, the
federal executive branch agencies,             Department of the Army, the U.S. Census Bureau, and the Department of
and reviewed OPM’s role in the                 Agriculture’s Agricultural Research Service and Forest Service. Some of these
hiring process.                                practices might help agencies across government improve their hiring processes.

                                               OPM recognizes that the federal hiring process needs reform and has a major
                                               initiative to study the federal hiring process. OPM’s efforts will be most effective
As a part of its ongoing efforts to            to the extent to which they help transform agency hiring practices from process
improve federal human capital                  focused to mission-focused hiring tools that are more closely integrated into
management, OPM needs to reform                agencies strategic plans.
the classification process, assist
agencies in automating their hiring            Total Federal New Hires, 1990–2002
processes, develop and help                    150,000 New hires
agencies develop improved hiring
assessment tools; and review the
effectiveness of selected hiring               120,000
authorities.

OPM and the agencies we studied
                                                90,000
provided comments on a draft of
this report. OPM generally agreed
with the conclusions and
recommendations. The report was                 60,000
revised to reflect the agency
comments.
                                                30,000

www.gao.gov/cgi-bin/getrpt?GAO-03-450.

To view the full report, including the scope          0
and methodology, click on the link above.                 1990     1991     1992     1993   1994   1995   1996   1997   1998   1999   2000   2001   2002
For more information, contact J. Christopher   Source: OPM Central Personnel Data File.
Mihm at (202) 512-6806 or mihmj@gao.gov.
Contents



Letter                                                                                                   1
                             Results in Brief                                                            3
                             Background                                                                  7
                             Federal Hiring Is a Lengthy, Cumbersome Process                            11
                             OPM’s Role and Performance in the Federal Hiring Process                   27
                             Conclusions                                                                28
                             Recommendations for Executive Action                                       29
                             Agency Comments and Our Evaluation                                         29


Appendixes
              Appendix I:    Federal Hiring Using the Competitive Service or the
                             Excepted Service                                                           32
             Appendix II:    Description of Category Rating Project Carried Out by the
                             Agricultural Research Service and the Forest Service                       34
             Appendix III:   Objectives, Scope, and Methodology                                         35
             Appendix IV:    Comments from the Office of Personnel Management                           38
              Appendix V:    Comments from the Department of Defense                                    44
             Appendix VI:    GAO Contacts and Staff Acknowledgments                                     51


Tables                       Table 1: Hiring Problems and Actions Under Way                              4
                             Table 2: Fiscal Year 2002 New Hires by Department                          10
                             Table 3: Survey Responses from 24 HR Directors                             37


Figures                      Figure 1: Total New Federal Hires from Fiscal Years 1990 through
                                       2002                                                              2
                             Figure 2: Typical Steps for Filling Vacancies through the
                                       Competitive Examining Process                                     8




                             Page i                                   GAO-03-450 The Federal Hiring Process
Contents




Abbreviations

ACWA                  Administrative Careers with America
ARS                   Agricultural Research Service
DOD                   Department of Defense
FS                    Forest Service
HR                    human resources
MSPB                  Merit Systems Protection Board
NAPA                  National Academy of Public Administration
OPM                   Office of Personnel Management
PACE                  Professional and Administrative Career Exam
SES                   Senior Executive Service
USGS                  U.S. Geological Survey




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Page ii                                            GAO-03-450 The Federal Hiring Process
A
United States General Accounting Office
Washington, D.C. 20548



                                    May 30, 2003                                                                                   Lert




                                    Congressional Requesters

                                    A high performance organization needs a dynamic, results-oriented
                                    workforce with the requisite talents, multidisciplinary knowledge, and up-
                                    to-date skills to ensure that it is equipped to accomplish its mission and
                                    achieve its goals. To acquire such a workforce and replace the huge cohort
                                    of federal employees eligible for retirement within the next 5-10 years
                                    demands that agencies have effective hiring processes so that they can
                                    compete for talented people in a highly competitive job market.
                                    Governmentwide, the number of federal new hires was about 50,000 a year
                                    in the mid-1990s, when many agencies were downsizing, but totaled more
                                    than 143,000 in fiscal year 2002.1 The annual number of new hires could
                                    easily increase to more than 150,000 as agencies take actions to address the
                                    security needs arising from the terrorist attacks of September 11, 2001, and
                                    to fill vacancies created by the large number of employees expected to
                                    retire over the next few years. The fiscal year 2003 budget called for an
                                    additional 27,000 full-time equivalent civilian positions in the Executive
                                    Branch over fiscal year 2002.

                                    Since 1996, the Office of Personnel Management (OPM) has delegated to
                                    federal executive branch agencies the authority to perform almost all
                                    hiring-related tasks; individual federal agencies control the way virtually all
                                    new hires are brought into their organizations.2 Generally, people are hired
                                    into competitive service positions, excepted service positions, or the
                                    Senior Executive Service. As shown in figure 1, the majority of federal
                                    hiring is for competitive service positions, and most are filled through the
                                    competitive examination process, which is governed by statutes and OPM
                                    regulations. In fiscal year 2001, about 72 percent (75,000 of the 104,000) of
                                    jobs that were filled were staffed using competitive service hiring
                                    authorities. In fiscal year 2002, with the increased excepted service hiring
                                    of the Transportation Security Administration, the percentage of
                                    competitive service hires dropped to 52 percent (74,000 of 143,000).



                                    1
                                      Much of the increase in federal new hires in 2002 was due to the hiring of baggage
                                    screeners and other personnel in the new Transportation Security Administration.
                                    2
                                     This report discusses the hiring of new employees into the federal government and focuses
                                    on the competitive service hiring process. Agencies can also fill vacant positions using the
                                    merit promotion process within their agency or through transfers from other agencies.




                                    Page 1                                              GAO-03-450 The Federal Hiring Process
Figure 1: Total New Federal Hires from Fiscal Years 1990 through 2002
150,000 New hires




120,000




 90,000




 60,000




 30,000




       0
           1990     1991     1992     1993   1994   1995   1996    1997   1998   1999   2000   2001   2002
                    Excepted service

                    Competitive service
Source: OPM Central Personnel Data File.

Note: Data are for new permanent full- and part-time hires based on information from OPM.


While recognizing the need for flexibility in hiring employees, the federal
government seeks to ensure that appointments comply with the
cornerstone of federal hiring—the merit principles. The examination
process is one of the processes intended to ensure that merit principles are
complied with and includes notifying the public that the government will
accept applications for employment and assessing applicants’ relative
competencies or knowledge, skills, and abilities against job-related criteria
to identify the most qualified candidates. The applicants for competitive
service positions must generally compete against each other through the
competitive examination process.

In response to your requests,3 the objectives of this report are to

• identify major factors that hamper or delay the federal hiring process;




3
  This report was also done at the request of the Honorable Fred Thompson, former Ranking
Minority Member, Senate Committee on Governmental Affairs.




Page 2                                                            GAO-03-450 The Federal Hiring Process
                   • provide examples of innovative practices used by our selected agencies
                     to improve their hiring processes; and

                   • identify opportunities for OPM, agencies, and others to improve the
                     federal hiring process.

                   To address these issues, we interviewed and surveyed the human resources
                   (HR) directors in the federal government’s 24 largest departments and
                   agencies. In addition to reviewing our own previous work, we reviewed
                   several studies of federal hiring by OPM, the Merit Systems Protection
                   Board (MSPB), the National Academy of Public Administration (NAPA),
                   and others. In addition, we further analyzed the hiring practices of five
                   executive branch agencies that had taken steps to improve their hiring
                   processes: the Department of Agriculture’s Agricultural Research Service
                   (ARS) and Forest Service (FS), the Department of the Army (Army), the
                   U.S. Census Bureau (Census), and U.S Geological Survey (USGS).4 We also
                   reviewed OPM’s role in the hiring process and collected and analyzed data
                   from OPM’s Central Personnel Data File on the use of various hiring
                   authorities. (See app. III for details on our scope and methodology.)



Results in Brief   There is widespread recognition that the current federal hiring process all
                   too often does not meet the needs of agencies in achieving their missions,
                   managers in filling positions with the right talent, and applicants for a
                   timely, efficient, transparent, and merit-based process. Numerous studies
                   over the past decade by OPM, MSPB, NAPA, the Partnership for Public
                   Service, the National Commission on the Public Service, and GAO have
                   noted problems with the federal hiring process. Nearly all of the federal
                   HR directors from the 24 major federal departments and agencies reported
                   that it takes too long to hire quality employees. Specifically, 21 of these HR
                   directors said that the time-to-hire was a moderate to great problem.
                   According to data compiled by OPM, the estimated time to typically fill a
                   competitive service position was more than 3 months with some HR
                   directors citing examples of hiring delays exceeding 6 months.

                   OPM and others have recognized that nearly all parts of the lengthy
                   competitive hiring process are cumbersome and ineffective. Agencies have
                   the primary responsibility for streamlining and automating their hiring

                   4
                     We have also taken a number of actions to improve our hiring process, including
                   strengthening our recruitment effort and automating our application and ranking process.




                   Page 3                                             GAO-03-450 The Federal Hiring Process
                                                processes, but OPM also plays an important role in providing leadership
                                                and oversight of the merit-based employment system and helping agencies
                                                meet their hiring challenges. Both the agencies we studied and OPM have
                                                recognized that the hiring system needs improvement and have taken a
                                                number of actions. Table 1 below summarizes the key problems with the
                                                federal hiring process that we, OPM, and others have identified, and what
                                                actions are being taken to address them.



Table 1: Hiring Problems and Actions Under Way

The problem                                                      Actions under way
Defining a job and determining the appropriate pay is            OPM has revised the classification standards for several job series,
complicated by the classification processes and standards,       including health care professions and law enforcement, to make them
which are outdated and not applicable to the jobs and work       clearer and more relevant to current job duties and responsibilities. OPM
of today.                                                        points out that this is only a partial solution noting that the classification
                                                                 standards and process need to be reformed.
Unclear, unfriendly job announcements cause confusion,           OPM has initiated an interagency project to modernize federal job vacancy
delay hiring, and serve as poor recruiting tools.                announcements, including providing guidance to agencies to enhance
                                                                 announcements. OPM is seeking contractor support for its USAJOBS
                                                                 Web site to make it easier and quicker for people to find federal jobs and to
                                                                 enhance the site’s “eye-catching” appeal.
A key assessment tool for evaluating applicants for Luevano OPM’s strategic plan states that by fiscal year 2005 governmentwide hiring
Consent Decreea positions and related hiring programs is    selections are to be based on improved assessment tools.
ineffective.
Manual processes, including the convening of panels and          Automating the hiring process can improve hiring timeliness and efficiency.
the manual rating and ranking of applicants to determine         USGS automated its hiring function resulting in a reduction of processing
best-qualified applicants, are time consuming.                   time, a reduction of 1,800 staff days of work, and an exponential increase
                                                                 in the number of applicants. Census also developed an automated hiring
                                                                 system for three critical occupations. In addition, OPM has developed an
                                                                 automated staffing system, USA Staffing, which can be purchased by
                                                                 federal agencies.
Numerical rating and ranking and the “rule of three” b limit     Congress passed the Homeland Security Act of 2002 that authorized
the choice of applicants.                                        agencies to use category rating in lieu of numerical rating and adherence
                                                                 to the “rule of three.” Category rating was determined to be effective in a
                                                                 demonstration project conducted by the ARS and FS. OPM is currently
                                                                 drafting guidance implementing this new flexibility.
Source: GAO.
                                                a
                                                 The Luevano consent decree is a 1981 agreement that settled a lawsuit alleging that a written test,
                                                Professional and Administrative Careers Examination (PACE), had an adverse impact on African
                                                Americans and Hispanics. See Luevano v. Campbell, 93 F.R.D. 68 (D.D.C. 1981). The consent decree
                                                called for the elimination of PACE and required replacing it with alternative examinations. Eventually,
                                                OPM developed the Administrative Careers with America examination. The consent decree also
                                                established two special hiring programs, Outstanding Scholar and Bilingual/Bicultural, for limited use in
                                                filling former PACE positions.
                                                b
                                                 5 U.S.C. § 3318(a) requires the selecting official to select from among the top three ranked candidates
                                                available for appointment—this is the rule of three.




                                                Page 4                                                      GAO-03-450 The Federal Hiring Process
The importance of OPM’s success in its hiring initiatives is underscored by
the results to our survey in October 2002, where HR directors had mixed
views on whether OPM helped or hindered their agencies’ hiring processes.
A little less than half thought that OPM helped the hiring process. Many
thought that OPM neither helped nor hindered the process and a few
thought OPM hindered their hiring efforts. HR directors said that OPM
needed to be a more active resource and enhance its role as a
“clearinghouse” of information while providing more guidance and better
expertise to agencies. This included assisting agencies in evaluating their
internal hiring processes as well as completing more comprehensive
evaluations of governmentwide hiring. As a part of this process, some
agencies explained that OPM needed to provide information and “best
practices” associated with automating the hiring process. They said it is
also important that OPM address key hiring obstacles, including job
classification, job announcements, manually rating candidates, and
assessment tools, especially those tools associated with hiring for the more
than 100 entry-level occupations covered by the Luevano Consent Decree.

More specifically, OPM’s efforts will be most effective to the extent to
which they help transform agency hiring practices from process focused to
mission-focused hiring tools that are more closely integrated into agencies’
strategic plans. Accordingly, as a part of its overall hiring initiative, we
recommend that OPM

• study how to improve, streamline, and reform the classification process;

• continue to assist agencies in making job announcements and Web
  postings more user friendly and effective;

• assist agencies in automating their hiring processes;

• develop and help agencies develop improved hiring assessment tools;
  and

• review the effectiveness of the Outstanding Scholar and
  Bilingual/Bicultural Luevano Consent Decree hiring authorities.

OPM and the Department of Defense (DOD) provided written comments on
a draft of this report, which are reprinted in appendices IV and V. USGS,
Census, FS, and ARS provided technical comments that have been
incorporated into the report.




Page 5                                     GAO-03-450 The Federal Hiring Process
OPM generally agreed with the conclusions and recommendations in the
report. However, OPM expressed several concerns with our methodology.
It believed the section on the classification and position description
process could be misleading because the majority of jobs are filled without
this step. We agree, but note that the more important problem with the
classification process is that inaccurate position descriptions and related
pay determinations that result from the job classification could hamper
efforts to fill the positions with the right employees. OPM also believed
that our draft missed an opportunity to hold agencies more accountable for
their hiring processes. Throughout the draft, we note that agencies are
primarily responsible for their hiring processes and provide concrete
examples of what some agencies have done to improve their processes.
OPM also provided several examples of actions it is taking to improve the
hiring process. Finally, OPM questioned our methodology of meeting with
agency HR directors to assess how well OPM is assisting agencies in
improving their hiring processes. It believes that chief operating officers
would provide a better perspective of agency recruiting and retention
issues. While we agree these officials could provide some added overall
perspective about the results of the hiring process, agency HR directors
better understand and are responsible for their agencies’ hiring processes.

DOD noted several areas where it believed that OPM needed to do much
more to address governmentwide hiring problems. We agree that OPM
should do more to improve governmentwide hiring and include several
recommendations to OPM.




Page 6                                     GAO-03-450 The Federal Hiring Process
Background   The cornerstone of federal hiring is its merit basis. Congress has retained
             the principle of appointment by merit throughout its various amendments
             and compilations of civil service laws. In enacting the Civil Service Reform
             Act of 1978, Congress reiterated the importance of merit in hiring by
             including a merit principle, which requires that “[r]ecruitment should be
             from qualified individuals from appropriate sources in an endeavor to
             achieve a work force from all segments of society, and selection and
             advancement should be determined solely on the basis of relative ability,
             knowledge, and skills, after fair and open competition which assures that
             all receive equal opportunity.” 5 OPM is responsible for ensuring that the
             personnel management functions it delegates to agencies are conducted in
             accordance with merit principles and the standards it has established for
             conducting those functions.6 In January 1996, OPM delegated examining
             authority, acting under the authority of Public Law 104-52, to federal
             agencies for virtually all positions in the competitive service. The delegated
             examining authority requires agencies to conduct competitive
             examinations that comply with merit system principles, other personnel-
             related laws, and regulations as set forth in OPM’s Delegated Examining
             Operations Handbook.

             Even though the majority of the civilian workforce obtained positions
             through the open competitive service examination process,7 certain
             positions are in the excepted service and are excepted from the
             competitive examination process.

             The competitive hiring process, which is described in more detail in
             appendix I, is shown in figure 2.




             5
                 5 U.S.C. 2301 § (b)(1).
             6
                 5 U.S.C. § 1104.
             7
               Agencies may also fill vacant positions with current government employees through
             competitive merit promotion. The process is less complicated than competitive examination
             of outside hires because neither the rule of three that limits selection to the top three
             candidates nor veterans preference apply to merit promotions. Also, applicants are not
             ranked on the basis of their numerical scores. Merit promotion job certificates include all of
             the candidates determined to be among the best qualified, and managers can select from any
             of those candidates.




             Page 7                                               GAO-03-450 The Federal Hiring Process
Figure 2: Typical Steps for Filling Vacancies through the Competitive Examining
Process



          Human capital office/
                                                             Delegated examining unit
             job manager




         Define job and set pay,
                                             Prepare public notice
             qualifications                                                     Receive applications
                                               and job vacancy
            and assessment                                                      ●   Electronically
                                                announcement
                 criteria                                                       ●   By mail
                                                                                ●   In person

          ●   Writes position description    ●   Complies with OPM
              and establishes job                content requirements.
              classification (occupation)                                       ●   Complies with OPM
                                             ●   Determines
              and pay grade level.                                                  procedures for
                                                 open/closing dates.                accepting and
          ●    Conducts job analysis:        ●   Complies with OPM's                documenting timely,
               Identifies job's important        minimum open                       complete, and
               roles, functions, and             periods.                           preference-eligible
               tasks.                                                               applications.
                                             ●   Posts announcement
          ●   Develops weighted                  on USAJOBS,
              criteria to evaluate the           governmentwide
              relative competencies,             automated
              and knowledge, skills,             employment
              and abilities of applicants.       information system.
          ●   Writes crediting or
              rating plan for making
              consistent and job-
              related determinations
              about the relative
              qualifications of
              applicants for a position.




Source: GAO.




Page 8                                                     GAO-03-450 The Federal Hiring Process
                                                                Selecting official                      Human capital office




Screen for eligibility
   and minimum                    Rate and rank                Candidate selection                            Bring new hire
    qualification               qualified candidates                                                             on board
     standards


                                ●   Convenes rating/           ●   Conducts interviews.                  ●
●   U.S. citizenship and            ranking panels.                                                          Makes job offer.
                                                               ●   Checks references.
    basic OPM educational       ●   Applies criteria in
    and work experience             crediting or rating        ●   Makes selection from top
    qualifications standards.       plan to make                   three available candidates
                                    consistent, job-related        (may choose not to                    ●   Conducts
                                    determinations on              select anyone).                           pre-employment checks
                                    relative merits of         ●   Veterans may                              and security clearances.
                                    applicants.                    not be passed over for                ●   Brings new hire
                                ●   Applies veterans’              nonveterans without                       on board.
                                    preference.                    justification and OPM
                                ●   Prepares a numerically         approval.
                                    ranked list of the         * Category rating will permit
                                    eligible candidates.         selection of anyone in
                                ●   Sends a list of at least     best qualified category
                                    three candidates to          (except where veteran's
                                    selecting official.          preference applies).

                                * Homeland Security Act
                                  of 2002 permits
                                  category rating.




                                                                                            102 days average




                                        Page 9                                                  GAO-03-450 The Federal Hiring Process
The number of new hires increased substantially since the mid-1990s—
increasing from about 50,000 employees in 1996 to over 143,000 employees
in 2002. Hiring in the mid-1990s declined because many agencies were
downsizing and did not need to fill positions. With the slowdown in
downsizing and the increasing numbers of personnel retiring, agencies are
increasingly hiring new employees. Prior to fiscal year 2002, about one-
third of all hires were hired by DOD. In 2002, the largest federal hirer was
the Department of Transportation, primarily the Transportation Security
Administration.8 Table 2 shows total new hires by department in fiscal year
2002.



Table 2: Fiscal Year 2002 New Hires by Department

                                                Competitive         Excepted
Agency                                             service            service         Total
Department of Transportation                           1,041           42,872       43,913
DOD                                                   24,969           12,372       37,341
Department of the Treasury                            16,924              943       17,867
Department of Veterans Affairs                         6,399            3,994       10,393
Department of Justice                                  6,956            1,122        8,078
Department of Agriculture                              4,327            1,161        5,488
Department of Health and Human
Services                                               3,072              925        3,997
Department of the Interior                             2,184              953        3,137
Social Security Administration                         1,572            1,485        3,057
Department of Commerce                                 2,032              526        2,558
All others                                             4,753            2,550        7,303
Total                                                 74,229           68,903      143,132
Source: OPM Central Personnel Data File.


The federal government’s hiring is expected to continue to increase. In
2003, the President’s budget called for approximately 27,000 additional full-
time equivalent federal civilian workers in the executive branch. This
follows a 36,000 increase in full time equivalent positions in fiscal year
2002.



8
  Since March 1, 2003, the Transportation Security Administration is part of the Department
of Homeland Security.




Page 10                                             GAO-03-450 The Federal Hiring Process
Federal Hiring Is a   It is widely recognized both within government and the private sector that
                      the federal hiring process is lengthy and cumbersome and hampers
Lengthy, Cumbersome   agencies’ ability to hire the people they need to achieve their agency goals
Process               and missions. Numerous studies over the past decade by OPM, MSPB,
                      NAPA, the Partnership for Public Service, the National Commission on the
                      Public Service, and GAO have noted problems with the federal hiring
                      process. Our October 2002 survey of HR directors at 24 major departments
                      and agencies indicated that 21 of 24 said that the time needed to fill
                      positions in their agencies was a moderate to very great problem.
                      Moreover, directors at 13 of those agencies reported that the time to hire
                      was a great to very great problem. Our October 2001 survey showed that 22
                      directors reported that time to hire was a moderate to great problem.
                      Nearly all (22 of 24) of the HR directors we met with said the lengthy and
                      cumbersome hiring process is a major factor that affects or increases the
                      time needed to fill positions.

                      HR directors cited problems with the lengthy hiring process. For example,
                      an HR director of a major federal department noted that thousands of
                      applicants had responded to nationwide openings for a critical occupation
                      at a number of locations. However, because it took so long to manually
                      process the applications, only 1 in 20 of the applicants were still interested
                      in the job when notified that they had been selected. Another HR director
                      noted that many managers, supervisors, and job applicants do not
                      understand the rules and procedures governing federal employment. She
                      said that because of the lack of expertise and complicated process, the
                      agency often loses out in competition with the private sector because of its
                      inability to make timely job offers. Another HR director told us that a
                      significant factor that hampers hiring is the paperwork-intensive hiring
                      process that continues from application, rating and ranking of applicants
                      and production of best qualified lists, through to the “17 forms” that a new
                      hire must complete before being brought onboard.

                      Although, as noted above, nearly all HR directors and others note that the
                      time to hire is too long for most federal hires. Comprehensive department
                      or governmentwide data are not available; however, in fiscal year 2002,
                      OPM compiled and analyzed data on time-to-hire and found that it typically
                      took 102 days for agencies to fill a vacancy using the competitive process.
                      OPM defined the time to hire time frame as the time between when the
                      request to hire or fill a position was received in the HR office to the
                      appointment of an applicant to the position. Additional time might be
                      needed for a manager to obtain approval for the requested hiring action at



                      Page 11                                     GAO-03-450 The Federal Hiring Process
the beginning of the process or for the new employee to receive a security
clearance at the end of the process.

Other organizations have noted problems with the lengthy cumbersome
federal hiring process.

• In July 2002, NAPA reported that federal “hiring remains a slow and
  tedious process.” The report noted that “Many managers are attempting
  to rebuild a pipeline of entry level employees in this very competitive
  labor market, yet current hiring methods do not keep pace with the
  private sector.”9

• In September 2002, MSPB said that the federal hiring process has a
  number of key problems including “overly complex and ineffective
  hiring authorities” and “inadequate, time-consuming assessment
  procedures.”10

• In November 2002, OPM in its strategic plan for 2002 through 2007
  stated, “ There is a general perception that our hiring process takes too
  long and may not provide well-qualified candidates.”11

• In January 2003, the National Commission on the Public Service said,
  “Recruitment to federal jobs is heavily burdened by ancient and illogical
  procedures that vastly complicate the application process and limit the
  hiring flexibility of individual managers.”12




9
  National Academy of Public Administration, Summary of Human Resources Management
Research for the National Commission on the Public Service (Washington, D.C.: July 2002).
10
  U.S. Merit Systems Protection Board, Making the Public Service Work: Recommendations
for Change (Washington, D.C.: September 2002).
11
 U.S. Office of Personnel Management, Strategic Plan 2002-2007 (Washington, D.C.:
November 2002).
12
  National Commission on the Public Service, Urgent Business for America: Revitalizing
the Federal Government for the 21st Century (Washington, D.C.: January 2003).




Page 12                                           GAO-03-450 The Federal Hiring Process
Not only does the current hiring process not serve agencies and managers
well as they seek to obtain the right people with the right skills, but
applicants can be dissuaded from public service by the complex and
lengthy process. According to a poll commissioned by the Partnership for
Public Service, “many people view the process of seeking federal
employment as a daunting one. Three-quarters of non-federal workers say
making the application process quicker and simpler would be an effective
way of attracting talented workers to government.”13

As many of these and other studies have noted, and as many HR directors
noted in our interviews, nearly all parts of the competitive hiring process
hamper effective and efficient federal hiring. Key problem areas include
the following.

• Outdated and cumbersome procedures to define a job and set the pay
  are not applicable to the jobs and work of today.

• Unclear, unfriendly job announcements cause confusion, delay hiring,
  and serve as poor recruiting tools.

• A key assessment tool and hiring programs used for several entry-level
  positions are ineffective.

• Convening panels and the manual rating and ranking of applicants to
  determine best-qualified applicants is time-consuming.

• Numerical rating and ranking and the “rule of three” limit the choice of
  applicants and are viewed as ineffective.14

OPM and the agencies we studied have taken steps to address some of
these hiring obstacles. Specifically, five agencies we examined—USGS,
Army, Census, ARS, and FS—took systematic and comprehensive
approaches that helped to transform their process-oriented hiring systems
to ones that are focused on meeting their agencies’ goals and missions. The


13
 Hart-Teeter Research, The Unanswered Call to Pubic Service: Americans’ Attitudes
Before and After September 11th (Washington, D.C.: October 2001).
14
  As previously discussed, the Homeland Security Act of 2002 now permits category rating
that expands the number of applicants that an agency official may choose from when filling
a position. That rating approach should make the rating process less complex and time
consuming than the numerical rating and ranking process.




Page 13                                            GAO-03-450 The Federal Hiring Process
                              USGS approach was to focus on automating its hiring process for all of its
                              occupations, except research Senior Executive Service positions, in order
                              to reduce hiring time, increase the number of applicants, and better serve
                              its internal and external customers. Army’s approach was a data-driven
                              approach—Army developed automated tools to identify weaknesses in its
                              hiring process and identified an approach to overcome them, including
                              automation. Census’s approach, in reaction to the need to quickly hire 500
                              specialists for the 2000 Census, was to work with OPM to jointly develop an
                              automated hiring system for three mission-critical occupations and later to
                              work toward integrating hiring for all its occupations into its parent
                              organization’s automated hiring system. And, as discussed later, OPM also
                              identified hiring improvements as a critical goal in its strategic plan and has
                              a multi-faceted hiring initiative under way. ARS and FS implemented a
                              pilot project that demonstrated a more effective way to rate and rank
                              candidates for positions.

                              The following sections describe each of these problems in more detail and
                              discuss some specific actions under way by agencies and OPM to begin to
                              address the problem.



Process of Defining the Job   The Problem
and Determining Pay Is
                              The process of defining a job and determining pay is complex and
Complex and Antiquated
                              antiquated, according to HR directors and experts. Defining the job and
                              setting pay must be based on federal job classification standards, which are
                              set forth in the Classification Act of 1949.15 The classification process and
                              standard job classifications were generally developed decades ago when
                              typical jobs were more narrowly defined and in many cases, were clerical
                              or administrative. However, today’s knowledge-based organizations’ jobs
                              require a much broader array of tasks that may cross over the narrow and
                              rigid boundaries of job classifications. The federal job classification
                              process not only delays the hiring process, but more important, the
                              resulting job classifications and related pay might not match the actual
                              duties of the job. This mismatch can hamper efforts to fill the positions
                              with the right employees.




                              15
                                   5 U.S.C. § 5101-5115.




                              Page 14                                      GAO-03-450 The Federal Hiring Process
Once management decides to fill a vacant position, or create a new
position, the HR office is called upon to see if a position description exists.
If a position description does not exist or is not accurate for the vacant
position, a position description must be completed. Such a description
documents the major duties, responsibilities, and organizational
relationships of a job and includes, among others, the knowledge required
for the position, supervisory controls, complexity and nature of the
assignment, and the scope and effect of the work.

Once the job description is complete, the job is classified by matching the
duties and responsibilities to the General Schedule requirements. The
Classification Act of 1949 provides a plan for classifying positions and sets
out 15 grade levels. The law expresses these grade levels in terms of the
difficulty and level of responsibility for a specific position. OPM develops
standards that must be consistent with the principles in the Classification
Act of 1949. The classification system categorizes jobs or positions
according to the kind of work done, the level of difficulty and
responsibility, and the qualifications required for the position, and serves as
a building block to determine the pay for the position. Today’s knowledge-
based organizations’ jobs require a much broader array of tasks that may
cross over the narrow and rigid boundaries of job classification standards
and make it difficult to fit the job appropriately into one of the over 400
occupations. According to a recent OPM study, a key problem with
classification is that, under present rules, characteristics such as workload,
quality of work, and results are not classification factors.16

As reported in a January 2003 report of the National Commission on the
Public Service, OPM’s director has noted that “continued reliance on this
antiquated system is comparable to insisting that today’s offices use carbon
paper and manual type writers.”17 Furthermore, NAPA in its July 2002
report for the National Commission on the Public Service concluded that
classification and compensation systems must be based on work and




16
 U.S. Office of Personnel Management, A Fresh Start for Federal Pay: The Case for
Modernization (Washington, D.C.: April 2002).
17
  National Commission on the Public Service, Urgent Business for America: Revitalizing
the Federal Government for the 21st Century (Washington, D.C.: January 2003).




Page 15                                          GAO-03-450 The Federal Hiring Process
performance rather than position.18 The NAPA panel recommendations
included abolishing the General Schedule and developing a modern system
for defining and valuing work, which could help to make the hiring process
more results-oriented and efficient. The National Commission on the
Public Service recommended that operating agencies need more flexible
personnel management systems. The commission recommended
abolishing the General Schedule and as a default position, recommended a
broadband system under which the 15 pay grades and salary ranges would
be consolidated into six to eight broad bands with relatively wide salary
ranges.19

Actions Under Way

Some agencies have automated the complicated classification process to
reduce the time it takes to carry out this task. For example, the Army
created a centralized database that gives Army HR managers access to
active position descriptions and position-related information to help with
the classification process. In addition, OPM has revised the standards for
several job series, including health care professions and law enforcement,
to make them clearer and more applicable to the current duties and
responsibilities of the occupations. But such steps are only partial
solutions to the classification issue. OPM points out that the classification
standards and process need to be reformed. Changes to the Classification
Act of 1949 are needed to make fundamental changes to how jobs are
defined and pay is set. Specifically, OPM believes that the time may have
come for substantive reform that brings the era of the General Schedule
classification system to a close. OPM recognizes the need to maintain the
General Schedule in the absence of an alternative and well-managed
transition to any new system.20




18
  National Academy of Public Administration, Summary of Human Resource Management
for the National Commission on the Public Service (Washington, D.C.: July 2002).
19
  National Commission on the Public Service, Urgent Business for America – Revitalizing
the Federal Government for the 21st Century (Washington, D.C.: January 2003).
20
 U.S. Office of Personnel Management, A Fresh Start for Federal Pay: The Case for
Modernization (Washington, D.C.: April 2002).




Page 16                                          GAO-03-450 The Federal Hiring Process
Job Vacancy Announcement     The Problem
Content Cited as Hampering
                             Several HR directors we interviewed for this study cited the content of job
the Hiring Process           announcements as a factor that hampered or delayed the hiring process.
                             These HR directors noted that job announcements are frequently
                             incomprehensible and make it difficult for applicants to determine what
                             the jobs require, and therefore do not serve as effective recruiting tools. A
                             February 2000 MSPB study stated that federal job announcements
                             generally appeared to be written for people already employed by the
                             government and that the use of jargon and acronyms is a common
                             problem.21 The study noted that some announcements were lengthy,
                             difficult to read on-line, and only gave brief or vague descriptions of the
                             duties to be performed. Vague job descriptions make it difficult for
                             applicants to describe how their knowledge, skills, and abilities are related
                             to the job. MSPB also noted that almost no announcements included
                             information on retirement and other benefits, such as vacation time and
                             medical and health insurance, which might entice people to apply. The
                             study recommended that OPM and agencies improve how vacancy
                             announcements are posted on the Internet. The report said making them
                             more visually appealing, informative, and easy to navigate could also make
                             announcements more effective as a recruiting tool. In a December 2002
                             report on federal vacancy announcements, MSPB reported that its review
                             of the quality of 100 vacancy announcements posted on USAJOBS
                             indicated that 53 percent were poor, 2 percent were good, while 45 percent
                             were judged acceptable.22 The problems in the vacancy announcements
                             included poor organization and readability, unclear job titles and duties,
                             vague or restrictive qualification standards, and the use of negative
                             language or tone that might deter many qualified candidates.

                             Actions Under Way

                             Both agencies and OPM are taking some steps to address this problem. For
                             example, the Department of Health and Human Services rewrote one of its
                             typical vacancy announcements for budget analysts to make it more
                             understandable and appealing to applicants outside the government.


                             21
                              U.S. Merit Systems Protection Board, Competing for Federal Jobs – Job Search
                             Experiences of New Hires (Washington, D.C.: February 2000).
                             22
                              U.S. Merit Systems Protection Board, Help Wanted: A Review of Federal Vacancy
                             Announcements (Washington, D.C.: December 2002).




                             Page 17                                          GAO-03-450 The Federal Hiring Process
                          Instead of the typical language such as “incumbent is responsible for
                          monitoring the results of budget execution and formulation input from six
                          regional budget offices in coordination with the controller,” the
                          announcement’s language began with “For the energetic individual who
                          wants a challenging career with growth and advancement opportunities,
                          we have positions available that will challenge to you to grow and learn
                          [and are on] the cutting edge of the nation’s health and human service
                          policy and provide vital information and support required by our policy
                          makers.” In addition, the job announcement was posted on a private sector
                          job search site and in The Washington Post employment section. This
                          approach garnered more than 100 qualified applicants per position,
                          compared to 20 qualified applicants per position under the traditional
                          announcements on USAJOBS Web site.23

                          To address unclear job announcements, OPM has initiated an interagency
                          project to modernize federal job vacancy announcements, including
                          providing guidance to agencies to enhance announcements, and instituting
                          a multiprong approach to using e-government technology to assist job
                          seekers and employees governmentwide. Specifically, OPM has improved
                          the Web site to strengthen the job search engine, rewritten the USAJOBS by
                          Phone system to improve speech recognition, and redesigned the way
                          vacancy announcements appear on the Web site. Currently, OPM is seeking
                          contractor support for its USAJOBS to make it easier and quicker for
                          people to find federal jobs and to enhance the site’s “eye-catching” appeal.



Key Assessment Tool and   The Problem
Related Hiring Programs
                          Several HR directors and human capital experts have found problems with
Are Ineffective           candidate assessment tools, particularly those associated with filling entry-
                          level professional and administrative occupations covered by the Luevano
                          Consent Decree of 1981. In addition, both OPM and MSPB noted in studies
                          that there is a need to develop new assessment tools for occupations and
                          higher-grade levels that are not covered by the Luevano decree that are
                          more efficient and valid predictors of future job performance. Primary
                          responsibility for developing assessment tools rests with the agencies, but
                          frequently agencies do not have the expertise or resources to develop
                          them. In addition to problems found with assessment tools, two hiring


                          23
                               Government Executive, Hire Power (Washington, D.C.: February 2002).




                          Page 18                                             GAO-03-450 The Federal Hiring Process
authorities set forth in the Luevano Consent Decree —Outstanding Scholar
and Bilingual/Bicultural—may not be merit based.

Several HR directors we met with and a NAPA study found that the
Administrative Careers with America (ACWA) self-rating schedule
examination procedure that is currently used to competitively fill most
positions covered by the Luevano decree was cumbersome, delayed hiring,
and often did not provide quality candidates. The Luevano decree called
for eliminating the use of the Professional and Administrative Career Exam
(PACE) and required replacing it with alternative examination
procedures.24 The ACWA exam, which was developed by OPM for Luevano
positions, was generally administered by OPM to applicants. Agencies
entered into reimbursable contracts with OPM to receive lists of candidates
who passed the exam. OPM has now delegated authority to administer the
ACWA exam to agencies’ delegated examining units.25 In addition, some
exams have been developed to replace ACWA for a few occupations.

Agency managers criticized the ACWA examination because they said it is
not merit based, according to a NAPA study.26 The ACWA rating-schedule
examination contains 157 multiple-choice questions that distinguish among
qualified applicants on the basis of their self-rated education and life
experience, rather than on their relative knowledge, skills, and abilities for
the vacant position.27 The study reported that agencies said the ACWA
examination is not relevant to specific jobs and occupations and therefore
does not result in lists of “qualified individuals … solely on the basis of
relative ability, knowledge, and skill”—a key merit systems principle.




24
  PACE which was used to fill entry-level positions at the GS-5 and GS-7 level for over 100
professional and administrative occupations, was found to have an adverse impact on
African Americans and Hispanics.
25
  In addition to the ACWA exam, OPM has developed separate alternative examination
procedures for a number of positions covered by the Luevano decree. In its comments on a
draft of this report, DOD noted that administration of the ACWA exam was not delegated to
agencies until October 2002 and that the authority cannot be redelegated to components.
26
  National Academy of Public Administration, Entry-Level Hiring and Development for
the 21st Century: Professional and Administrative Positions (Washington, D.C.: November
1999).
27
     There also is a written ACWA exam that was developed prior to the multiple choice exam.




Page 19                                              GAO-03-450 The Federal Hiring Process
Consequently, many agencies reported that the primary reason they did not
use the ACWA test was their past experience with the quality of the
candidates. In a more recent study, NAPA recommended that the ACWA
examination system be terminated and agencies be permitted to hire for
professional and administrative occupations using techniques that are
proven more operationally efficient and effective in meeting diversity
shortfalls.28 Also, MSPB recommended that OPM develop new assessment
tools for the occupations covered under the Luevano Consent Decree.29

HR directors and other officials illustrated numerous problems with the
ACWA exam. For example, the Deputy Assistant Commissioner for Human
Resources at the Social Security Administration said that the ACWA
examination process used for its mainstream entry-level positions—claims
representative, computer specialist, criminal investigator, and regional
support position—covered by the Luevano Consent Decree is
cumbersome, bureaucratic, and labor intensive. In another example,
officials of a major military installation said that recruiting accountants and
financial managers was hampered by the ACWA examination. They noted
that managers believed the test was not an effective screen to identify
quality candidates—a theme consistent with the NAPA study. They also
pointed out that applicants were “turned off” to federal employment by the
lack of relevance of many of the exam questions to the specific jobs for
which they were applying.

Agencies cited the Outstanding Scholar program as a quick way to hire
quality college graduates for positions covered by the Luevano decree. The
Outstanding Scholar program and Bilingual/Bicultural program were
authorized by the Luevano Consent Decree as supplemental tools to
competitive examination. These programs were aimed at addressing the
under representation of African-Americans and Hispanics in the
workplace. Many HR directors and officials viewed the Outstanding
Scholar program as a way to hire quality candidates without getting
involved in the complexities of the OPM examination process.




28
 National Academy of Public Administration, Summary of Human Resources
Management Research for the National Commission on the Public Service (Washington,
D.C.: July 2002).
29
 U.S. Merit Systems Protection Board, Making the Public Service Work –
Recommendations for Change.




Page 20                                          GAO-03-450 The Federal Hiring Process
However, OPM and MSPB have commented that this is an inappropriate
use of the authority. This hiring authority uses both baccalaureate grade
point average and class standing as eligibility criteria for appointment. This
authority allows candidates who meet the eligibility criteria to be directly
appointed without competition and operates without regard to veterans’
preference or the rule of three (see discussion about the rule of three and
veterans’ preference later is this report). MSPB has noted, however, that
eligibility criteria based on grade point average and class rank are highly
questionable as valid predictors of future job performance and that they
unnecessarily deny employment consideration to a large segment of the
applicant pool who meet basic job qualification requirements.

MSPB also has concerns about the Bilingual/Bicultural program because it
permits the hiring of individuals who need not be the best qualified and
avoids veterans’ preference. This hiring program permits an agency to
directly hire an applicant who obtained a passing examination score,
without further regard to rank, when the position should be filled by an
incumbent with bilingual or bicultural skills and the applicant has the
requisite skills. MSPB has also recommended abolishing both the
Outstanding Scholar and Bilingual/Bicultural programs because other
competitive hiring methods have been more effective in hiring minorities
and because they are not merit based.

For positions that are not covered by the Luevano Consent Decree,
agencies typically examine candidates by rating and ranking them based on
their experience, training, and education, rather than testing them. MSPB
noted that the government’s interest is not well served if agencies do not
have the resources and expertise to make high quality case examining
determinations. According to MSPB, agencies use of computer-based
assessments is increasing. MSPB notes this has implications for OPM
because the validity of computer-based assessments and ranking is critical
to ensuring that hiring is based solely on merit.30 Computer-based
assessments would also have implications for category rating systems that
are now permitted by the Homeland Security Act of 2002.

In general, both OPM and MSPB are concerned about the validity of
assessment tools for all occupations and advocate that agencies improve
their assessment instruments. Under a largely decentralized approach,


30
 U.S. Merit Systems Protection Board, Assessing Federal Job-Seekers in a Delegated
Examining Environment (Washington, D.C: December 2001).




Page 21                                           GAO-03-450 The Federal Hiring Process
                            agencies’ delegated examining units make decisions on which assessment
                            tools or methods to use and on the development of new assessment tools.
                            However, experts have noted that that there has been a lack of specialized
                            experience in many agencies to develop and maintain valid, effective
                            applicant assessment methodologies. OPM told us that because of budget
                            constraints, it has spent more of its resources on services for which
                            agencies are willing to pay rather than on providing tools that it might have
                            believed to be more valuable, like assessment instruments. OPM also
                            noted that many agencies do not have the technical expertise, funding, or
                            time to develop valid assessment tools. MSPB concluded in a recent report
                            that OPM is a logical organization to which agencies should be able to turn
                            for help in developing valid assessment tools and systems, but is not
                            funded to provide that assistance except on a reimbursable basis.31

                            Actions Under Way

                            OPM recognizes that it must do more to improve assessment tools. In its
                            fiscal year 2003 performance plan, OPM included a strategic objective that,
                            by fiscal year 2005, governmentwide hiring selections are to be based on
                            comprehensive assessment tools that assess the full range of competencies
                            needed to perform the jobs of the future.



Manual Processes Are Time   The Problem
Consuming and Paperwork
                            A key problem noted by many HR directors is that much of the hiring
Intensive                   process is done manually. Among the most frequently cited factors that
                            hampered or delayed hiring were the logistics of convening assessment
                            panels and the time-consuming process of manually rating and ranking job
                            applicants. Twelve agency HR directors we interviewed commented that
                            manually rating and ranking candidates, or the panel process, was a
                            significant cause of delay in hiring. In addition, time-consuming and
                            paperwork-intensive record keeping is needed to document the rationale of
                            assessment panel ratings.

                            Prior to assessing applicants based on their relative merits, agencies must
                            conduct a screening process to determine if applicants meet eligibility
                            requirements (e.g. are U.S. citizens) and the basic or minimum education or

                            31
                             U.S. Merit Systems Protection Board, Assessing Federal Job-Seekers in a Delegated
                            Examining Environment.




                            Page 22                                           GAO-03-450 The Federal Hiring Process
work experience qualifications that OPM established for such a position.
In a manual hiring system, staff members would have to review all the
applications and document why an applicant did or did not meet minimum
qualifications. If there are a large number of applicants, carrying out this
process can be time consuming.

Once the applicants’ eligibility is determined, agencies typically undertake
a labor-intensive effort to establish and convene assessment panels and
manually rate and rank the candidates based on their relative merits.
According to one of the HR directors we met with, the logistics of setting
up an assessment panel meeting makes for long delays in the hiring
process, in some cases up to 1 month. Some of the delay is due to
assembling the appropriate managers and subject matter experts,
coordinating their availability, and factoring in the exigencies of other
demands and travel time. Once the panel is formed, the panel sorts through
all of the applicants’ paperwork, assesses the applicants, and determines a
numerical score for each applicant by rating the education and experience
described by the applicant against the evaluation criteria in the crediting
plan for the position. At this point, any applicable veterans’ preference
points are added to the applicants’ score. As mentioned previously, the
Homeland Security Act of 2002 permits an agency to use a category rating
system that might make assessing candidates less complex and time
consuming.

Automation has the potential to streamline operations by electronically
rating and ranking applicants, or placing them in quality categories,
eliminating the need to form assessment panels, and greatly reducing the
paperwork burden associated with manual assessments. An automated
system creates an easily assessable audit trail so that managers and HR
staffs could document their decisions. In addition, an automated system
could electronically determine if an applicant met the basic qualifications
and electronically notify the applicant of his or her eligibility for the job for
which he or she applied.

Actions Under Way

Nineteen of the 24 agency HR directors we met with said they had
automated or planned to automate at least a portion of their hiring
processes. Some of these agencies have automated or planned to automate
the rating and ranking processes. Agencies have used private vendors or
have contracted to use OPM’s USA Staffing automated hiring package.




Page 23                                       GAO-03-450 The Federal Hiring Process
USGS automated its hiring system and estimated that it cut hiring time
from the close of a job announcement to issuing a job certificate from 30 to
60 days to under 7 days. USGS’s automated system is a computerized
employment application processing system, which automates many of the
functions and tasks of the competitive examination process. It
electronically prescreens applicants and rates and ranks applicants
according to specified job-related criteria. This also eliminates the need to
convene rating and ranking panels and reduces the paperwork and
administrative burden associated with documenting manual rating and
ranking. The system also electronically refers the job certificate to the
selecting official who has the rating and ranking data, résumés, and other
information on his or her desktop, an improvement in efficiency.
Furthermore, it makes recruiting data available on-line to authorized staff
members. Applicant benefits include user-friendly on-line application and
timely feedback on the status of applications. NAPA chronicled the
success of USGS’s automated system in a 2001 report. The report notes
that 1 year after being implemented, “it is clear that the program is a huge
success.”32 The report lays out the successes based on USGS information
to include a significant reduction of processing time a reduction of 1,800
staff days of work, and a nearly tenfold increase in the number of
applicants for many of its announcements.

Census also automated its hiring process. The impetus for Census to
change from its manual hiring system to the automated system for its
occupations covering the majority of its ongoing hiring needs—information
technology specialist, statistician, and mathematical statistician—was a
large number or positions (500 positions) and urgent hiring needed for the
2000 Census.33 The agency put together a team of managers, human
resource staff, and programmers and worked with OPM to automate hiring
for these three occupations. In 1998, Census automated their hiring system
through OPM for the three occupations. Under this system, OPM posts
continuously open vacancy announcements for multiple grade levels. As
part of a contract with Census, OPM receives the applications and
maintains an inventory of applicants on its system and can rate and rank
the applicants and generate a job certificate for Census within 3 days of the
request for a certificate. Since there is no closing date for job

32
   National Academy of Public Administration, The Quest for Talent: Recruitment Strategies
for Federal Agencies (Washington, D.C.: 2001).
33
 These 500 positions were professional in nature and not part of the temporary enumerator
workforce hired for the 2000 Census.




Page 24                                            GAO-03-450 The Federal Hiring Process
                              announcements, many phases of the typical federal hiring process have
                              been completed in advance of a Census request for a certificate. Census
                              managers provide quality-ranking factors to OPM when they request a job
                              certificate. In addition, Census managers have electronic access to
                              information on the applicants because OPM updates Census’s database
                              daily. Census officials told us that additional applicant information
                              collected by recruiters on college campuses provides managers pertinent
                              skill data, which could eliminate personal interviews. Census estimated
                              that time to hire declined from 3 to 4 months to a week or less. For other
                              occupations, Census continues to use its manual competitive examination
                              hiring process to hire people from outside the government.



The Rule of Three Limits      The Problem
Managers’ Choice of Quality
                              One of the largest obstacles to the federal hiring process mentioned in our
Candidates
                              interviews with HR directors was the rule of three. Specifically, 15 of the 24
                              HR directors we met with raised concerns about the negative impact of the
                              rule of three on hiring. Once the panel has rated and ranked the
                              candidates and applied applicable veterans’ preference points, the panel
                              refers a sufficient number of candidates to permit the appointing officer to
                              consider three candidates that are available for appointment. The selecting
                              official is required to select from among the top three ranked candidates
                              available for appointment—this is the rule of three.34 If a candidate with
                              veterans’ preference is on the list, the selecting official cannot pass over
                              the veteran and select a lower ranking candidate without veterans’
                              preference unless the selecting official’s objection to hiring the veteran is
                              sustained by OPM.35 The Homeland Security Act of 2002, enacted in
                              November 2002, now permits agencies governmentwide to use category
                              rating in lieu of numerical ranking and adherence to the rule of three.36
                              OPM currently is drafting implementing guidance for this provision. A
                              more complete description of category ranking is included in appendix II.
                              It will be important for agencies to adopt category ranking to improve their
                              hiring processes.



                              34
                                   5 U.S.C. § 3318(a).
                              35
                                   5 U.S.C. § 3318(b).
                              36
                                   Section 1312(a)(2) of Pub. L. No. 107-296 (Nov. 25, 2002).




                              Page 25                                                 GAO-03-450 The Federal Hiring Process
Choosing from among the top three candidates is problematic for a variety
of reasons. MSPB noted in its study on the rule of three that “the
examination procedures underpinning this hiring rule vary in their ability to
make fine distinctions among candidates.” Further, veterans’ preference
points are added to the imprecise numerical score generated through the
panel’s examination process, which can result in veterans being ranked
among the top three candidates. The result can be several candidates with
the exact same score. When more than three candidates have the same
score, examining offices may need to break the tie, usually by electing
three of the candidates at random.

Since current assessment tools cannot make fine distinctions between
applicants, encouraging selection from as many qualified candidates as is
reasonable enhances merit-based hiring. The MSPB conducted an in-depth
study of the rule of three and its interaction with veterans’ preference.37
MSPB concluded that given the limits of the examining process to predict
future job performance, the curb on the number of candidates from which
managers may select does not represent good hiring policy. It also noted
that the rule of three’s original purpose was to provide choices.

For several years, federal human capital experts said that categorical rating
or grouping could provide an alternative to the rule of three methods and
expand the number of candidates that a selecting official could choose
from while protecting veterans’ preference. Both NAPA and MSPB
supported abolishing numerical ranking and the rule of three and replacing
them with category rating that would allow officials to select among
candidates that were placed in a high-quality category. However,
candidates with veterans’ preference placed in the high-quality category
would be hired before candidates without veterans’ preference. OPM also
supported allowing agencies to use category rating in lieu of numerical
ranking and the rule of three.

Actions Under Way

The Department of Agriculture’s ARS and FS tested and implemented
category rating in lieu of numerical ranking and the rule of three under an
OPM demonstration project. The final 5-year evaluation of the project
showed that (1) the number of candidates per job announcement


37
 U.S. Merit Systems Protection Board, The Rule of Three in Federal Hiring: Boon or
Bane? (Washington, D.C.: December 1995).




Page 26                                           GAO-03-450 The Federal Hiring Process
                         increased, (2) more candidates were referred to managers for selection,
                         (3) hiring speed increased, and (4) there was greater satisfaction with the
                         hiring process among managers. On average, there were from 60 percent
                         (ARS) to 70 percent (FS) more applicants available for consideration under
                         the demonstration project quality grouping procedure than under the
                         standard rule of three and numerical ranking. A higher percentage of
                         veterans were hired in the ARS and about the same percentage of veterans
                         were hired by the FS compared with using the rule of three process.
                         Specifically, at ARS 16.3 percent of all hires were veterans using categorical
                         ranking, while just 9.5 percent were veterans using the rule of three. At
                         ARS, the average length of time to hire was about 25 days quicker than at
                         comparison sites. At FS, the time to hire was quicker, but the difference
                         was not significantly different. Appendix II contains more information on
                         the categorical ranking project carried out by the ARS and FS.

                         As noted previously, the Homeland Security Act of 2002, enacted in
                         November 2002, included a governmentwide provision that OPM or an
                         agency to which OPM has delegated examining authority may establish
                         category rating systems for evaluating applicants for positions in the
                         competitive service. Under this provision a selecting official can select
                         anyone placed in the top category. However, a candidate with veterans’
                         preference who is placed in the top category could not be passed over by a
                         selecting official unless objection to hiring the veteran is sustained by
                         OPM. OPM is currently drafting guidance to implement this new flexibility.



OPM’s Role and           OPM has recognized that the hiring system needs improvement and, as
                         pointed out earlier in this report, is taking a number of actions to address
Performance in the       governmentwide hiring challenges. OPM’s current strategic plan includes a
Federal Hiring Process   major objective to “Increase the effectiveness and efficiency of the Federal
                         hiring process and make Federal employment attractive to high-quality
                         applicants of diverse backgrounds.” To meet this objective, OPM has
                         identified a number of strategies, including reducing regulatory burdens
                         that hamper hiring, increasing recruitment through e-government
                         initiatives, and identifying other governmentwide solutions to improve the
                         hiring process. In addition, last spring OPM announced a hiring initiative
                         that is designed to create momentum for success, build the image of public
                         service, and fix the hiring process. A number of actions have already taken
                         place in the first wave. In July 2002, OPM announced the development of a
                         hiring preferred practices guide and asked agencies to contribute examples
                         of how they had optimized existing hiring flexibilities. Also, last summer
                         OPM held the government’s first “virtual job fair” for information



                         Page 27                                     GAO-03-450 The Federal Hiring Process
              technology workers that demonstrated that critically needed staff could be
              hired effectively and efficiently. OPM said that in the coming months it will
              identify other projects and proposals that will address systemic problems
              associated with the hiring process. It will include deploying competency-
              based qualifications, improving entry-level hiring, and updating and
              modernizing exam scoring policy.

              Our survey of HR directors in the fall of 2001 and then again in the fall of
              2002 showed mixed views on whether OPM helped or hindered the hiring
              process in their agencies. Specifically in 2001, 13 thought OPM helped, 5
              thought OPM neither helped nor hindered, and 5 thought OPM hindered
              their hiring processes. In 2002, 9 thought OPM helped, 9 thought OPM
              neither helped nor hindered, and four thought OPM hindered the
              processes. Details of our survey are included in appendix III.

              HR directors we talked with identified other actions that OPM took to help
              their departments or agencies improve their hiring processes. These
              processes included delegation of examination authority, providing human
              capital expertise, and providing the USAJOBS and USA Staffing programs.
              The HR directors also identified areas in which OPM could take a more
              active role. Foremost, agencies said that OPM needed to be a more
              proactive resource and enhance its role as a “clearinghouse” of information
              and provide more guidance and better expertise to agencies. Agencies
              explained that OPM needed to provide information and “best practices”
              associated with automating the hiring process. They also noted that OPM
              could do more to address key obstacles in the hiring process, including
              outdated classification standards and inadequate assessment tools.



Conclusions   Improving the federal hiring process is critical as the number of new hires
              is expected to increase substantially to address the security needs arising
              from the terrorists attacks of September 11, 2001, and to replace the large
              number of employees expected to retire over the next few years. Agencies
              are responsible for maximizing the efficiency and effectiveness of their
              hiring processes within the current statutory and regulatory framework.
              Steps toward a higher-level hiring system include using a data-driven
              approach to identify hiring barriers and ways to overcome them. A key
              step includes automating the hiring process, which may drive efficiency
              and reduce the administrative and paperwork burden. Innovative and best
              practices of model agencies need to be made available to other agencies in
              order to facilitate the transformation of agency hiring practices from
              compliance based to one focused on the agencies’ missions. While many



              Page 28                                     GAO-03-450 The Federal Hiring Process
                      improvements to hiring processes can be made by agencies themselves,
                      OPM has recognized that it needs to do more to address some key
                      governmentwide problems.



Recommendations for   OPM’s hiring initiatives are moving in the direction that will help agencies
                      improve their hiring processes. OPM can assist agencies by helping the
Executive Action      agencies to improve and streamline their hiring processes by taking a
                      comprehensive and strategic approach. Consistent with its current efforts
                      to improve the federal hiring process, OPM needs to take a number of
                      specific actions to strengthen federal hiring. Accordingly, as a part of its
                      overall hiring initiative, we recommend that OPM

                      • study how to simplify, streamline, and reform the classification process;

                      • assist agencies in automating their hiring processes;

                      • continue to assist agencies in making job announcements and Web
                        postings more user friendly and effective;

                      • develop and help agencies develop improved hiring assessment tools;
                        and

                      • review the effectiveness of the Outstanding Scholar and
                        Bilingual/Bicultural Luevano Consent Decree hiring authorities.



Agency Comments and   OPM and DOD provided written comments on a draft of this report.
                      Technical comments were provided orally by USGS and via email by
Our Evaluation        Census, ARS, and FS. These technical comments have been incorporated
                      into the report.

                      OPM generally agreed with the conclusions and recommendations in the
                      report. However, OPM expressed several concerns with our methodology.
                      It believes the section on the classification and position description
                      process could be misleading because the majority of jobs are filled without
                      this step. We agree, but note that the more important problem with the
                      classification process is that inaccurate position descriptions and related
                      pay determinations that result from the job classification could hamper
                      efforts to fill the positions with the right employees. OPM also believed
                      that our draft missed an opportunity to hold agencies more accountable for



                      Page 29                                    GAO-03-450 The Federal Hiring Process
their hiring processes. Throughout the draft, we note that agencies are
primarily responsible for their hiring processes and provide concrete
examples of what some agencies have done to improve their processes.
OPM also provides several examples of actions it is taking to improve the
hiring process. Finally, OPM questioned our methodology of meeting with
agency HR directors to assess how well OPM is assisting agencies in
improving their hiring processes. It believes that chief operating officers
would provide a better perspective of agency recruiting and retention
issues. While we agree these officials could provide perspective about the
results of the hiring process, agency HR directors better understand and
are responsible for their agencies’ hiring processes.

DOD noted several areas where it believed that OPM needed to do much
more to address governmentwide hiring problems. We agree that OPM
should do more to improve governmentwide hiring and include several
recommendations to OPM.


As agreed with your offices, unless you publicly release its contents earlier,
we plan no further distribution of this report until 30 days from its date. At
that time, we will send copies of this report to the Chair, Senate Committee
on Governmental Affairs, the Chairman, House Committee on Government
Reform, the Chairwoman of the Subcommittee on Civil Service and Agency
Organization, House Government Reform. We will also send copies to the
Director of OPM, the Secretary of the Army, the Secretary of Commerce,
the Secretary of Interior, and the Secretary of Agriculture. We will also
make copies available to others upon request. In addition, the report will be
made available at no charge on the GAO Web site at http//:www.gao.gov.

If you have any questions about this report, please contact Edward
Stephenson or me on (202) 512-6806. Key contributors to this report are
listed in appendix VI.




J. Christopher Mihm
Director, Strategic Issues




Page 30                                     GAO-03-450 The Federal Hiring Process
List of Requesters

The Honorable Joseph I. Lieberman
Ranking Minority Member
Committee on Governmental Affairs
United States Senate

The Honorable Daniel K. Akaka
Ranking Minority Member
Subcommittee on Financial Management, the
  Budget and International Security
Committee on Governmental Affairs
United States Senate

The Honorable George V. Voinovich
Chairman
The Honorable Richard J. Durbin
Ranking Minority Member
Subcommittee on Oversight of Government
  Management, the Federal Workforce
  and the District of Columbia
Committee on Governmental Affairs
United States Senate

The Honorable Thad Cochran
United States Senate

The Honorable Danny K. Davis
Ranking Minority Member
Subcommittee on Civil Service
  and Agency Organization
Committee on Government Reform
House of Representatives

The Honorable Dave Weldon, M.D.
House of Representatives




Page 31                               GAO-03-450 The Federal Hiring Process
Appendix I

Federal Hiring Using the Competitive Service                                                                 Append
                                                                                                                  xeis




or the Excepted Service                                                                                        AppenIx
                                                                                                                     di




               Federal civil service employees, other than those in the Senior Executive
               Service (SES) are employed in either the competitive service, 5 U.S.C. §
               2102(a), or the excepted service, 5 U.S.C. § 2103(a).1 The competitive
               service examination process is one of the processes intended to ensure that
               agencies’ hiring activities comply with merit principles. This includes
               notifying the public that the government will accept applications for a job,
               screening applications against minimum qualification standards, and
               assessing applicants’ relative competencies or knowledge, skills, and
               abilities against job-related criteria to identify the most qualified
               applicants. Federal agencies typically examine or assess candidates by
               rating and ranking them based on of their experience, training, and
               education, rather than by testing them.2

               Except as noted before, Title 5 of the U.S. Code requires federal examining
               offices to give job applicants numerical scores and refer candidates for
               employment to selecting officials based on their scores. Higher scores
               theoretically represent greater merit and thus improve candidates’
               employment opportunities. In addition, veterans’ preference requires
               augmenting scores of certain individuals because of military service
               performed by them or members of their families.3 The rule of three
               requires managers to select from among the top three numerically ranked
               candidates available for appointment.4 However, if a candidate with
               veterans’ preference is among the top three candidates, the manager
               cannot pass over the veteran and select a lower ranked candidate without
               veterans’ preference unless the selecting official’s objection to hiring the


               1
                 Positions may be excepted from the competitive service by statute, by the President, or by
               the Office of Personnel Management (OPM). 5 C.F.R. § 213.101. OPM may except positions
               from the competitive service when it determines that appointments into such positions
               through competitive examination are not practicable. 5 C.F.R. § 6.1(a). Excepted
               appointments can be under either Schedule A (e.g., chaplain and attorney positions),
               Schedule B (e.g. Student Career Experience Program and SES candidate development
               program positions), or Schedule C (political appointee positions). 5 C.F.R. Part 213, Subpart
               C.
               2
                 Agencies use written tests to assess certain outside candidates. The most important
               written tests are used for hiring into two groups: (1) GS-2, 3,and 4 entry-level clerks and
               technical positions, and (2) GS-5 and GS-7 professional and administrative positions
               covered by the Luevano Consent Decree. GS refers to General Schedule, which is the basic
               classification and compensation system for white-collar occupations in the federal
               government.
               3
                   5 U.S.C. § 3309.
               4
                   5 U.S.C. § 3318(a).




               Page 32                                              GAO-03-450 The Federal Hiring Process
Appendix I
Federal Hiring Using the Competitive Service
or the Excepted Service




veteran is sustained by the Office Of Personnel Management (OPM).5
Ensuring that these objectives are met involves several basic steps and the
preparation of extensive supporting documentation.

Soon agencies will have greater flexibility under the competitive service
examination process with the option of using category ranking. The
Homeland Security Act of 2002, enacted on November 25, 2002, has a
governmentwide provision that will now permit agencies to establish
category rating systems for evaluating applicants by placing them in two or
more quality categories based on merit.6 The rule of three does not apply,
and selecting officials can select anyone placed in a best-qualified category.
However, if a candidate with veterans’ preference is placed in a best-
qualified category, the veteran cannot be passed over and must be selected
unless the selecting official’s objection to hiring the veteran is sustained by
OPM. OPM is currently drafting guidance to implement this legislation.




5
    5 U.S.C. § 3318(b).
6
    Section 1312(a)(2) of Pub. L. No. 107-296 (Nov. 25, 2002).




Page 33                                                 GAO-03-450 The Federal Hiring Process
Appendix II

Description of Category Rating Project
Carried Out by the Agricultural Research
Service and the Forest Service                                                                               AppenIx
                                                                                                                   di




               A Department of Agriculture demonstration project carried out by the
               Agricultural Research Service (ARS) and the Forest Service (FS)
               demonstrated that category rating, or quality grouping, can provide
               managers with a larger pool of applicants from which to choose than
               numerical ranking and the rule of three, while protecting veterans’
               preference. ARS and FS believed that the rule of three hampered their
               ability to hire the people they needed. From 1990 to 1998, ARS and FS
               carried out the U.S. Department of Agriculture Personnel Management
               Demonstration Project, authorized by the Office of Personnel Management
               (OPM).1 The purpose of the project was to develop a recruitment and
               selection program for new hires that was flexible and responsive to local
               recruitment needs. This was the first demonstration project testing a
               comprehensive simplification of the hiring system for both blue and white-
               collar federal employees.

               The project tested the use of category rating as an alternative hiring
               process. Instead of numerical rating and ranking that required selection
               from the highest three scorers under the rule of three, under category
               rating applicants meeting minimum qualification standards are placed in
               one of two groups (quality and eligible) on the basis of their education,
               experience, and ability. All candidates in the quality group are available for
               selection; however, if the quality group contains a veteran, the veteran must
               be hired unless an objection to hiring the veteran is sustained. If the
               number of candidates falling into the quality group is inadequate,
               applicants from the eligible group can also be referred to the manager for
               selection.

               As noted before, evaluations of this demonstration project showed it to be
               effective. Because there was no mechanism in current law to make a
               demonstration project permanent, innovations that were tested
               successfully in demonstration projects could not be implemented
               permanently in the testing agency unless authorized by Congress in special
               legislation. The demonstration project at the Department of Agriculture
               was made permanent through legislation in October 1998.2




               1
                OPM is authorized to waive civil service laws and regulations to permit agencies to test
               alternative personnel management approaches. 5 U.S.C. § 4703.
               2
                   Section 749 of Pub. L. No. 105-277 (Oct. 21, 1998).




               Page 34                                                   GAO-03-450 The Federal Hiring Process
Appendix III

Objectives, Scope, and Methodology                                                            Appen
                                                                                                  Ix
                                                                                                   di




               As agreed with the requesters and in accordance with discussions with
               their offices, the objectives of this study were to

               • identify major factors that hamper or delay the federal hiring process;

               • provide examples of innovative practices or approaches used by
                 selected agencies to improve their hiring processes and have the
                 potential to be adapted by other agencies; and

               • identify opportunities for the Office of Personnel Management (OPM),
                 agencies, and others to improve the federal hiring process.

               We reviewed the practices associated with how the government hires
               people from outside the government for competitive service positions,
               including entry-level and higher graded General Schedule positions. We
               focused our work on the competitive examination process used to fill those
               positions because that is usually the way that most agencies bring people
               into their organizations. In addition, we obtained information on special
               hiring authorities that are frequently used to hire people for entry-level
               positions and that may supplement the competitive examination hiring
               process. We did not review in detail how the government fills positions
               through merit promotions with people who are already employed by the
               federal government.

               To identify major factors that hamper or delay the competitive hiring
               process, we first reviewed our prior work and extant literature on federal
               hiring. We also interviewed experts and obtained their studies at

               • the U.S. Merit Systems Protection Board (MSPB), a federal agency that
                 hears and decides civil service cases, reviews OPM regulations, and
                 conducts studies of the federal government’s merit system;

               • the National Academy of Public Administration, an independent
                 nonpartisan, nonprofit, congressionally chartered organization that
                 assists federal, state, and local governments in improving their
                 performance;

               • the National Partnership for Public Service, a nonpartisan organization
                 dedicated to revitalizing the public service; and

               • OPM, the federal government’s human resources (HR) agency.




               Page 35                                    GAO-03-450 The Federal Hiring Process
Appendix III
Objectives, Scope, and Methodology




We used experts’ findings or observations to augment information we
obtained from federal agencies and incorporated them into our report as
appropriate. We then reviewed the pertinent laws, Code of Federal
Regulations and OPM’s Delegated Examining Operations Handbook that
governs the competitive examination hiring process in order to describe
how the hiring process works and to later describe what agency human
resource directors and studies identified as steps, processes, or regulatory
requirements that hampered or delayed hiring. In addition, we reviewed
data on hiring contained in OPM’s Central Personnel Data File.

Next we gathered information on our three objectives by conducting
semistructured interviews with the HR directors of the 24 largest federal
departments and agencies. The interviews were conducted from
September through December 2001. The open-ended questions were
categorized and coded and entered into a database we created. Responses
to closed questions on how significant a problem time to hire was were also
entered into our database. At least two staff reviewers collectively coded
the responses from each of the 24 interviews, and the coding was verified
when entered into the database.

In addition to these interviews with HR directors, we conducted brief
surveys of these 24 directors in both the fall of 2001 and fall of 2002.1 All 24
HR directors responded to both surveys. During the period between the
2001 and 2002 surveys, 16 of the 24 individuals left their positions.

The results of each of these surveys are shown in table 3.




1
  These surveys were conducted in conjunction with our work on personnel flexibilities.
Our work on flexibilities resulted in two reports: Human Capital: Effective Use of
Flexibilities Can Assist Agencies in Managing Their Workforces (GAO-03-2, Dec. 6, 2002)
and Human Capital: OPM Can Better Assist Agencies in Using Personnel Flexibilities
(GAO-03-428, May 9, 2003, restricted until June 9, 2003.)




Page 36                                           GAO-03-450 The Federal Hiring Process
Appendix III
Objectives, Scope, and Methodology




Table 3: Survey Responses from 24 HR Directors

Question                          Response                             Fall 2001   Fall 2002
To what extent is the time        Little or no extent                          0           0
needed to fill a position, or     Some extent                                  2           3
“hiring time,” a problem within
your department /agency?          Moderate extent                              7           8
                                  Great extent                                13          10
                                  Very great extent                            2           3
                                  No basis to judge/NA                         0           0
Overall, would you say that       Greatly hindered                             0           2
OPM has helped or hindered        Somewhat hindered                            5           2
the hiring process in your
department/agency?                Neither helped nor hindered                  5           9
                                  Somewhat helped                             11           7
                                  Greatly helped                               2           2
                                  No basis to judge/NA                         1           2
Source: GAO.


In order to provide examples of innovative practices or approaches used by
selected agencies to improve their hiring processes and that have the
potential to be adapted by other agencies, we conducted a second phase of
interviews at five selected agencies from February through November
2002: Department of Agriculture’s Agricultural Research Service (ARS) and
Forest Service (FS), U. S. Geological Survey (USGS), U.S. Census Bureau
(Census), and Department of the Army (Army). We selected those agencies
based on interviews with HR directors across government and discussions
with HR experts who noted that these agencies had taken actions to
improve their hiring practices.

We assessed the role that OPM has played in the hiring process through
interviews with HR directors at the 24 largest departments or agencies,
experts at MSPB and OPM, and by reviewing expert studies and other
information. We provided a draft of this report to OPM, DOD, Census, ARS,
FS, and USGS for review and comment. Their responses and comments are
discussed at the end of the report. We did our review in Washington D.C.,
from June 2001 through January 2003 in accordance with generally
accepted government auditing standards.




Page 37                                                 GAO-03-450 The Federal Hiring Process
Appendix IV

Comments from the Office of Personnel
Management                                                             Appen
                                                                           V
                                                                           Id
                                                                            xi




Note: GAO comments
supplementing those in
the report text appear
at the end of this
appendix.




See comment 1.




See comment 2.




                         Page 38   GAO-03-450 The Federal Hiring Process
                 Appendix IV
                 Comments from the Office of Personnel
                 Management




See comment 3.




See comment 4.




                 Page 39                                 GAO-03-450 The Federal Hiring Process
                 Appendix IV
                 Comments from the Office of Personnel
                 Management




See comment 5.




                 Page 40                                 GAO-03-450 The Federal Hiring Process
                 Appendix IV
                 Comments from the Office of Personnel
                 Management




See comment 6.




                 Page 41                                 GAO-03-450 The Federal Hiring Process
               Appendix IV
               Comments from the Office of Personnel
               Management




               The following are GAO’s comments on the Office of Personnel
               Management’s (OPM) letter dated May 6, 2003.



GAO Comments   1. OPM questioned our methodology of meeting with agency human
                  resources (HR) directors to assess how well OPM is assisting agencies
                  in improving their hiring processes. OPM believes that chief operating
                  officers would provide a better perspective of agency recruiting and
                  retention issues. While we agree these officials could provide
                  perspective about the results of the hiring process, agency HR directors
                  better understand and are responsible for their agency hiring process
                  and most directly interact with OPM. Agency HR directors are
                  therefore in an excellent position to speak to federal hiring issues and
                  OPM’s leadership.

               2. OPM said it was unclear why we identified the five hiring problem areas
                  and also that the quality of hires was not identified as an issue. We
                  identified these areas based on our discussions with human capital and
                  other officials across government and in our review of studies by the
                  Merit Systems Protection Board and the National Academy of Public
                  Administration. Our assessment of these problems considered the
                  impact on the quality of hires. For example, we note in our discussion
                  of the federal job classification process that it not only delays the hiring
                  process for those positions requiring the development of job
                  descriptions, but more important, the resulting job classification and
                  related pay might not match the actual duties of the job. This mismatch
                  can hamper efforts to fill the position with the right employee. We also
                  note that the automated process at the U.S. Geological Survey
                  increased the number of applicants—which increases the likelihood of
                  filling a position with the right person. Finally, in our discussion of the
                  use of the Administrative Careers with America (ACWA) test we note
                  managers’ concerns with the quality of candidates who were referred
                  based on the test results. The recommendation to address this issue
                  was primarily based on the fact that, according to managers, the test
                  was not referring quality candidates.

               3. OPM said that our conclusions about the classification process could
                  be misleading. For example, it believes the section on the classification
                  and position description process could be misleading because the
                  majority of jobs are filled without this step. We agree, but note that the
                  more important problem with the classification process is that the
                  existing inaccurate position description and related pay that resulted



               Page 42                                      GAO-03-450 The Federal Hiring Process
Appendix IV
Comments from the Office of Personnel
Management




    from the job classification could hamper efforts to fill the position with
    the right employee. OPM also said that although it agreed that the
    grade level definitions that underpin the entire classification system are
    decades old, it has taken steps to revise position classification
    standards. We note in our report that OPM has and is continuing to
    revise position standards, but point out that the basic system needs
    revision. This position is not inconsistent with OPM’s and others’ views
    of classification. OPM’s white paper on pay notes a key problem with
    classification is that, under present rules, characteristics such as
    workload, quality of work, and results are not classification factors.
    OPM and others conclude that the classification system needs basic
    revision.

4. OPM points out in its comments that it has taken several steps to assist
   agencies in improving their vacancy announcements. We recognized
   many of these actions in our actions under way section and have
   augmented the section to further outline OPM’s positive steps.

5. OPM had some concerns about our comments about the ACWA test.
   We noted that managers were critical of the ACWA exam because it was
   not merit based and it measures life experiences rather than
   knowledge, skills, and abilities. OPM says the ACWA exam was
   specifically developed to measure competencies critical to the success
   of the relevant occupations. We should point out that the ACWA exam
   is used for more than 100 different occupations. Agency managers we
   met with and several studies have pointed out that the test does not
   refer quality candidates. Even though OPM in its comments defends
   the ACWA exam, it agreed that the test needs to be reevaluated. We
   recommend that OPM help agencies improve all applicant assessment
   tools.

6. OPM said that the report misses an opportunity to hold agencies more
   accountable for the cumbersome hiring process. Throughout the
   report, we point out that agencies are primarily responsible for
   improving their hiring processes and include several examples how the
   agencies we studied in detail took steps to improve various aspects of
   their hiring processes. These steps could be taken by agencies without
   any action by OPM. Several of our recommendations to OPM call for
   actions to assist agencies in addressing their hiring problems.




Page 43                                     GAO-03-450 The Federal Hiring Process
Appendix V

Comments from the Department of Defense                                Appen
                                                                           V
                                                                           di
                                                                           x




Note: GAO comments
supplementing those in
the report text appear
at the end of this
appendix.




                         Page 44   GAO-03-450 The Federal Hiring Process
                 Appendix V
                 Comments from the Department of Defense




See comment 1.




See comment 2.




See comment 3.




                 Page 45                                   GAO-03-450 The Federal Hiring Process
                 Appendix V
                 Comments from the Department of Defense




See comment 4.




See comment 3.




See comment 5.




See comment 6.




See comment 7.



See comment 8.




                 Page 46                                   GAO-03-450 The Federal Hiring Process
                        Appendix V
                        Comments from the Department of Defense




See comment 9.




See comment 10.




See comment 11.




See comments 3 and 9.




                        Page 47                                   GAO-03-450 The Federal Hiring Process
               Appendix V
               Comments from the Department of Defense




               The following are GAO’s comments on the Department of Defense’s (DOD)
               letter dated April 14, 2003.



GAO Comments   1. We have clarified that our report only discusses new hires to the federal
                  government, particularly focusing on the competitive service hiring
                  process. We note that agencies can also fill positions through the
                  internal merit selection process and other intergovernmental methods.

               2. The statement that agencies have the primary responsibility for their
                  hiring processes is a fact. Our report outlines several actions that the
                  Office of Personnel Management (OPM) has taken to address many
                  hiring problems. We agree that OPM could do more and have made
                  several recommendations that address that conclusion.

               3. DOD noted the lack of progress by OPM in addressing the job
                  classification system and applicant assessment tools. We agree that
                  OPM needs to do more and have included recommendations in that
                  regard. It should be noted that agencies have the primary responsibility
                  to address their hiring problems. Although some problems, such as the
                  job classification system, are outside the control of agencies, others,
                  such as development of assessment tools is within the responsibility
                  and control of the agency. The Merit Systems Protection Board (MSPB)
                  has pointed out that while agencies have the responsibility to develop
                  assessment tools they often do not have the resources to do so.

                   In addition, DOD said that implementing an automated hiring system
                   like the one we describe at the U.S. Geological Survey (USGS) would
                   take up to a decade because DOD is so large and diverse. DOD explains
                   that converting from knowledge, skills, and abilities, to competencies
                   takes a considerable amount of work. Although, USGS officials and we
                   believe, and an independent study indicates that the specific USGS
                   automated system has been successful, we are not endorsing a specific
                   method of automation. Our larger point on this section is that
                   automation can assist agencies with their hiring processes.

               4. It is correct that we did not attempt to compare procedures and time
                  lines for hiring before and after OPM delegated examining authority to
                  agencies in 1996. Such a comparison probably would yield little value
                  to today’s discussion of hiring challenges.




               Page 48                                    GAO-03-450 The Federal Hiring Process
Appendix V
Comments from the Department of Defense




5. DOD says the classification system has been studied from every angle
   without producing significant results and that more study is not
   needed. We believe that more analysis is needed to determine exactly
   how to either revise the classification system or develop an entirely
   new approach to determining job descriptions and pay determinations.

6. DOD asked that we explain why the number of new hires has increased
   since the mid-1990s. We have added text to the report that explains that
   hiring in the mid-1990s declined because many agencies were
   downsizing and did not need to fill positions. We also added that with
   the slowdown in downsizing and the increasing number of employees
   retiring, agencies are increasingly hiring new employees.

7. Our draft report had noted that DOD did not respond to our fall 2002
   survey of human resources (HR) directors. DOD explained that it
   responded to our survey of HR directors in November 2002. However,
   we did not receive itd response until April 2003. We have now included
   DOD’s response in our analysis of the 2002 HR director responses.

8. DOD points out that OPM has not taken any significant action to
   address problems related to the Luevano Consent Decree. We agree
   that the problems with the Luevano Consent Decree need to be
   addressed and have made a recommendation to OPM to review the
   effectiveness of the Outstanding Scholar and Bilingual/Bicultural
   Luevano Consent Decree hiring authorities.

9. DOD notes that examining for Administrative Careers with America
   (ACWA) positions was not delegated to agencies until October 2002 and
   that the authority cannot be redelegated to components. We have
   added this information to our report.

10. DOD noted that we did not analyze the planned actions in OPM’s
    strategic plan. In several areas, we have outlined actions that OPM is
    currently taking to address some of the hiring challenges, including
    some areas specific to actions indicated in OPM’s strategic plan.

11. DOD notes that our report credits OPM with developing new guidance
    in several human capital areas with no indication of the involvement of
    agencies. OPM has explained that one of the vehicles it has used to
    involve agencies is the Human Resources Management Council, an
    interagency organization of federal HR directors. It should be noted
    that the recently enacted Homeland Security Act of 2002 establishes an



Page 49                                    GAO-03-450 The Federal Hiring Process
Appendix V
Comments from the Department of Defense




    Interagency Chief Human Capital Officer Council, which could replace
    the Human Resources Management Council.




Page 50                                   GAO-03-450 The Federal Hiring Process
Appendix VI

GAO Contacts and Staff Acknowledgments                                                         AppenV
                                                                                                    d
                                                                                                    xiI




GAO Contacts      J. Christopher Mihm or Edward Stephenson, (202) 512-6806



Acknowledgments   In addition to the persons named above, John Ripper, Tom Beall, Ridge
                  Bowman, Christopher Booms, Karin Fangman, Fig Gungor, Donna Miller,
                  Greg Wilmoth, and Kimberly Young made key contributions to this report.




(450034)          Page 51                                  GAO-03-450 The Federal Hiring Process
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