United States
General Accounting Office
Washington, D.C. 20548
General Government Division
B-275361
May 20, 1997
The Honorable Alfonse M. D’Amato
Chairman, Committee on Banking,
Housing, and Urban Affairs
United States Senate
Subject: Federal Workforce: Attrition Rates at Ex-Im Bank and Similar Agencies
Dear Mr. Chairman:
This letter responds to your September 4, 1996, request for information on the
extent of employee attrition at the Export-Import Bank (Ex-Im Bank) and similar
agencies. Specifically, we agreed to determine the number of employees who left
Ex-Im Bank during the last 5 years, the number of these employees who were in
core professional positions, and how Ex-Im Bank’s attrition rates compared with
those of similar agencies. We also agreed to determine how many employees who
left Ex-Im Bank received retention allowances. Our results are summarized below,
and detailed information on turnover rates at the Ex-Im Bank, the United States
Agency for International Development (AID), and the Overseas Private Investment
Corporation (OPIC) are presented in Enclosure I.
BACKGROUND
The Ex-Im Bank’s mission is to assist U.S. exporters by offering a wide range of
financing at terms competitive with those of other governments’ export financing
agencies and absorbing risks that the private sector is reluctant to cover. Financing
and protection provided by Ex-Im Bank includes (1) loans to foreign buyers of U.S.
exports, (2) loan guarantees to commercial lenders providing repayment protection
for loans to foreign buyers of U.S. exports, (3) working capital guarantees for pre-
export production, and (4) export credit insurance to exporters and lenders
protecting them against the failure of foreign buyers to pay their credit obligations.
GAO/GGD-97-104R Attrition Rates at Ex-III-I Bank and Similar Agencies
/qcY ?-Iffy
B-275361
Ex-Im Bank had a staff of about 440 employees in fiscal year 1996, and identifies its
core professional positions as economists, engineers, attorneys, business development
officers, financial analysts, and loan specialists. Prior to being authorized to use
retention allowances in fiscal year 1991, Ex-Im Bank officials expressed concerns that
the agency experienced difliculty retaining qualified staff because of its inability to
compete with private firms and some federal agencies in employee compensation. Ex-
Im Bank officials also cited concerns over high performing employees’attractiveness
to other employers as a primary reason for awarding retention allowances to almost
50 percent of its employees in fiscal year 1995. Ex-Im Bank officials continue to
believe that employee losses in core job series hamper the Bank’s ability to maintain
critical continuity of essential programs and policies because of the institutional
knowledge lost and the time required to hire and train replacements. Ex-Im Bank
officials said that unlike large federal agencies with a reservoir of personnel to
maintain continuity of programs and operations, Ex-Im Bank does not have such
resources to draw upon.
AID and OPIC have missions and employee occupations similar but not identical to
those of Ex-Im Bank. AID is an independent federal agency that manages foreign
economic and humanitarian assistance programs around the world and has several
objectives, including promoting broad-based economic growth. In fiscal year 1996,
AID had about 2,300 employees worldwide who worked with domestic and foreign
organizations and governments to assist in sustaining economic development in
foreign countries through financial aid and technical assistance.
OPIC assists in financing and insuring political risks for business enterprises in
developing countries. OPIC’s mission is to promote U.S. investment overseas. In
fiscal year 1996, OPIC had about 200 employees who assisted businesses to identify
and reach foreign markets through three principal activities: (1) insuring foreign
investments against a broad range of political risks, (2) financing businesses and
investment funds through loans and loan guaranties, and (3) engaging in outreach
activities designed to inform the American business community of investment
opportunities in developing countries.
Both AID and OPIC have professional and administrative employee occupations
similar to those of employees at Ex-Im Bank. These include economists, attorneys,
program analysts, business and industrial specialists, accountants, and secretarial staff.
AID had provided physician comparability allowances to six physicians during fiscal
years 1992through 1996, and OPIC had awarded one retention allowance during the
GAO/GGD-97-104R Attrition Rates at Ex-Im Bank and Similar Agencies
2
B-275361
same period.’ AID and OPIC officials both said that they did not offer any other types
of retention incentives to their civil service employees during fiscal years 1992 through
i&6. AID officials said that they did not believe other retention incentives were
needed, and OPIC officials said that while turnover hampers productivity, they
believed the use of retention allowances would neither be fuIly effective nor
supportable under the current justification requirements.
RESULTS
During fiscal years 1992 through 1996, 220 employees left Ex-Irn Bank; 15 of these
employees had received retention allowances, 58 were in core professional
occupations, 38 were in noncore professional occupations, and 124 were in
administrative occupations.’ During this period, Ex-Im Bank had attrition rates for aU
of its employees that ranged from 0.4 to 12.7 percentage points lower than AID’s and
OPIC’s rates for alI their employees. (See fig. 1.1.)
During these five fiscal years, Ex-Im Bank also experienced lower attrition rates of
core professional employees than did AID and OPIC for employees in the same
occupational series. During fiscal years 1992 through 1996, Ex-Im Bank experienced
core employee attrition rates ranging from 7.0 to 17.9 percentage points lower than
AID’s and 3.7 to 22.0 percentage points lower than OPIC’s rates for the same
occupational series. (See fig. 1.2.)
Ex-Im Bank experienced losses of 7, 9, 15, 11, and 16 employees from its core
professional occupations during fiscal years 1992 through 1996, respectively.3 The
‘Physician comparability allowances are additional biweekIy payments for federal
physicians serving in areas or specialties with documented recruitig or retention
problems.
2Ex-Im Bank awarded 2,2,98, and 217 retention allowances in fiscal years 1992 through
1995, respectively. In fiscal year 1996, Ex-Im Bank had 200 retention ahowances in effect
until January 19, 1996, when the allowances were terminated. In March and April 1996,
eight of the allowances were reinstated and were in effect for the remainder of the fiscal
year.
3Ex-Im Bank’s core job series, which experienced the highest attrition rates over the 5
fiscal years, varied. Economists had the highest attrition rates in fiscal years 1992 and
1993, 16.7 and 18.2 percent, respectively. In fiscal years 1994 and 1996, business
GAO/GGD-97-104R Attrition Rates at Ex-Im Bank and Similar Agencies
3
B-275361
number of employees in the core positions, however, remained relatively constant due
to new hires and transfers from other occupational series within Ex-Im Bank. During
fiscal years 1993 through 1996, Ex-Im Bank had 159, 184, 183, and 188 employees,
respectively, in its core professional occupations. In fiscal year 1992, Ex-Im Bank had
significantly fewer core employees-lag-but Ex-Im Bank also had 103 fewer total
employees at that time. (See fig. 1.3.)
The three agencies’attrition rates for their other employees-noncore professional and
administrative-varied in relation to one another during fiscal years 1992 through 1996.
Ex-Im Bank and AID had the highest rates in fiscal years 1992 and 1994, respectively,
and OPIC had the highest rates in the other 3 fiscal years. Ex-Im Bank’s higher
attrition rates for the other employees were primarily due to higher attrition rates for
its administrative employees. (See fig. 1.4.)
SCOPE AND METHODOLOGY
On the basis of discussions with the Committee staff and Ex-Im Bank officials, and
our knowledge of agencies’missions and workforces, we identified two agencies with
missions and employee occupations similar to those of Ex-Im Bank? To develop
information on the attrition rates at those agencies and Ex-Im Bank, we obtained and
analyzed raw data from Ex-Im Bank, AID, and OPIC dealing with employment totals,
separations, new staff hires, and reassignments by occupation for the period
October 1, 1991, through September 30, 1996. We did not verify this information with
agencies’source documents, such as personnel files.
Ex-In-t Bank’s Director of Personnel categorized its various occupational series as core
professional and other-noncore professional and administrative. We used these
categorizations for occupational series that were the same at AID and OPIC. When
either agency had a series not existing at Ex-Im Bank, we assigned it to the “other”
grouping and judgmentally placed it in either the noncore professional or
administrative category. We did this to provide a consistent grouping and comparison
of AID’s and OPIC’s occupational series with those of Ex-Im Bank.
development officers had the highest attrition rates, 16.1 and 14.9 percent, respectively.
In fiscal year 1995, general engineers had the highest attrition rates of 33.3 percent.
!I’he U.S. Trade and Development Agency was not included because it had only 38
employees and therefore, the attrition rates could be misleading.
GAO/GGD-97-104R Attrition Rates at Ex-Im Bank and Similar Agencies
4
B-275361
Also, to make the agencies’employee groups as comparable as possible, we compared
only civil service employees who were covered by title 5 of the U.S. Code. We did
this because AID had about 1,300 foreign service employees covered by title 22 of the
U.S. Code in fiscal year 1996 who had different benefits, such as retirement eligibility
at age 50 with 20 years of service. AID officials said that excluding foreign service
employees was appropriate because the ability to retire at an earlier age may be a
significant inducement for such employees to stay with AID at earlier years in their
careers.
In determining the agencies’attrition rates, we controlled for the effect of expansions
or downsizing by the agencies. To calculate the agencies’annual attrition rates by job
series and in the two groupings-core professional, and noncore professional and
administrative-for fiscal years in which buyouts and Reductions-in-Force (RIF) were
not effective, we first determined the number of full-time employees by series and
grouping at the beginning of each fiscal year5 We then determined the number of
employees who separated by series and grouping during each fiscal year and
calculated the percentages of total employees that the number of separated employees
represented.” To determine the annual attrition rates in fiscal years in which the
agencies’employees received buyouts or were RIFed, we deducted the number of
employees who took buyouts or were RIFed from the number of employees in each
job series at the beginning of the fiscal year and from the number of employees who
separated from the agencies7 Buyouts and RIFs inflate attrition rates because they
include positions that the agency has chosen to abolish. We then calculated the
percentages the remaining separated employees represented. We also did not include
replacement employees, such as new hires, in our attrition calculations because that
would deflate an agency’s attrition rate during a period of expansion. Including
5RIFs involve separating an employee from his/her position due to a lack of funds,
reorganization, or other reasons.
‘Employees retiring from the three agencies are included in the attrition rates. With the
exception of fiscal year 1996, as discussed above, the retirement rates at the three
agencies were similar. Ex-Im Bank’s, AID’s, and OPIC’s retirement rates as a percentage
of total separations for fiscal years 1992 through 1995, represented 15.0, 12.6, and 11.5
percent, respectively.
7AID conducted a major RIF in fiscal year 1996 after several years of downsizing. From
September 30, 1992, to March 31, 1997, the number of civil service employees in AID has
decreased by 383 employees from 1,659 to 1,276 employees. Neither Ex-Im Bank nor
OPIC had any RIFs during fiscal years 1992 through 1996.
GAO/GGD-97-104R Attrition Rates at Ex-Im Bank and Similar Agencies
5
B-275361
buyouts, RIFs, and replacements would have created a biased comparison of attrition
rates since Ex-Im Bank’s employment levels generally grew during the 5 fiscal years
and AID and OPIC experienced some downsizing.
We also compared the names of the Ex-Im Bank employees leaving the Bank during
this period, to the names of Ex-Im Bank employees who had received retention
allowances, to deterrnine the number of employees leaving the Bank who had received
retention allowances.
We did our work in Washington, D.C., from February to April 1997 in accordance with
generally accepted government auditing standards. We provided a draft of this letter
to the Acting President and Chairman of Ex-Im Bank, the Administiator of AID, and
the Acting President and Chief Executive Officer of OPIC for their review and
comment.
AGENCY COMMENTS
Ex-h-n Bank and AID provided written comments on a draft of this letter. Ex-Im Bank
said that our methodology used to determine annual attrition rates for core employees
does not fully reflect the Ex-Im Bank’s losses of these employees. Ex-Im Bank
believes that the attrition rates should be calculated using the total number of
separations during a fiscal year, including employees who receive buyouts, because
each employee who is lost affects Ex-Im Bank’s ability to carry out its mission. While
we do not disagree that the loss of an employee may affect an agency, we do not
believe that employees who receive buyout incentives to leave an agency should be
reflected in attrition rates in the same manner as employees who are not induced to
leave and leave due to reasons not within an agency’s control. In administering
buyouts, Ex-Im Bank had the authority to exclude specific occupational series,
including core series, and thus could control who received the buyout incentives to
retie. Thus, as discussed in our scope and methodology section, we purposely
eliminated from our calculations employees who took buyouts to minimize their
impact on attrition rates.
Ex-Im Bank also noted that our review included attrition figures through the end of
fiscal year 1996, and stated that based on current and projected losses of Ex-Im Bank
employees in core occupations, they estimated the attrition rate for core employees in
fiscal year 1997 will exceed 10 percent.
GAO/GGD-97-104E Attrition Rates at Ex-Im Bank and Simihr Agencies
6
B-275361
AID expressed concern that we did not sufficiently highlight the fact that our attrition
rates do not include replacements. We have modified our scope and methodology
section to clarify this issue and have added a note to each of the relevant figures that
the rates do not include replacement employees. We also added a footnote, as
suggested by AID, pointing out that AID had a major RIF in 1996.
We received oral comments from the Directors for Legislative Affairs and Human
Resources Management, OPIC, on May 14, 1997. These officials agreed that the
information provided in the letter is accurate.
Ex-Im Bank, AID, and OPIC also provided technical comments, which we incorporated
in our letter where appropriate. Ex-Im Bank’s and AID’s comments are reprinted in
Enclosures II and III.
We are sending copies of this letter to the Ranking Minority Member of the Senate
Committee on Banking, Housing, and Urban AlYairs; the Acting Chairman, Ex-Im Bank;
the Administrator, AID; the President and Chief Executive Officer, OPIC; and other
interested parties. We will also make copies available to others upon request.
Major contributors to this letter were Larry Endy, Tom Davies, and Jeff Dawson. We
trust that this information satisfactorily responds to your request. If you have any
questions concerning this letter, please contact me at (202) 512-8676.
Sincerely yours,
L. Nye Stevens
Director
Federal Management
and Workforce Issues
Enclosures - 3
GAOiGGD-97-104R Attrition Rates at Ex-Im Bank and Similar Agencies
7
ENCLOSURE I ENCLOSURE I
Figure 1.1: Comwrison of Attrition Rates for All EmDlovees at Ex-Im Bank. AID, and
OPIC, Fiscal Years 1992-1996
40 Percent
30
25.3
20
15.9
11.7
10
0
1992 1993 1994 1995 1996
Fiscal years
0 Ex-lmBank
@ ),I,,
m OPIC
Note: Attrition rate calculations do not include replacement employees
GAO/GGD-97-104R Attrition Rates at Ex-Im Bank and SimiIar Agencies
8
ENCLOSURE I ENCLOSURE I
Figure 1.2: Comwrison of Attrition Rates for Core Emr>loveesat Ex-Im Bank, AID,
and OPIC, Fiscal Years 1992-1996
40 Percent
30
27.7
20
IO
0
1992 1993 1994 1995 1996
Fiscal years
u Ex-lm Bank
I;“:i: AID
m OPIC
Note: Attrition rate calculations do not include replacement employees.
GAO/GGD-97-104R Attrition Rates at Ex-Im Bank and Similar Agencies
9
ENCLOSURE I ENCLOSURE I
Figure 1.3: Total and Core EmDlovment at Ex-Im Bank for F’iscal Years 1992-1996
500 Number of employees
450
400
350
300
250
200
150
100
50
0
1992 1993 1994 1995 1996
Fiscal years
All Ex-lm Bank Employees
I Core Ex-lm Bank Employees
GAOlGGD-97-104R Attrition Rates at Ex-Im Bank and Similar Agencies
10
ENCLOSURE I ENCLOSURE I
Figure 1.4: Comwrison of Attrition Rates for Noncore and Administrative Emplovees
at Ex-Im Bank, AID, and OPIC. Fiscal Years 1992-1996
40 Percent
30
22.4
20
IO
0
1992 1993 1994 1995 1996
Fiscal years
) Ex-lm Bank
mi A,,J
Note: Attrition rate calculations do not include replacement employees.
GAO/GGD-97-104R Attrition Rates at Ex-Im Bank and Similar Agencies
11
ENCLOSURE II EXCLOSURE II
COMMENTS FROM THE EXPORT-IMPORT BANK
.T====-f -.=
&M k ANK
Joasnf8O~z~EUORTS
May 7, 1997
United StatesGeneral Accounting Office
Mr. L. Nye Stevens,Director
Federal Managementand
Workforce Issues
Washington, D.C. 20548
Dear Mr. Stevens:
This letter respondsto your draft report to the Chairman,
Committee on Banking, Housing, and Urban Affairs, Unite-dStates
Senate,‘on Attrition Rates at Ex-Im Bank and Similar Agencies.
The “Background’ section of the report, statesthat Ex-In officials
believe employee lossesin corejob series hamperthe Bank’s ability to
deliver services becauseof the institution knowiedge lost and the time
required to hire and train replacements. We would like to emphasize
further that staff lossesin mainline occupation serieshamperthe Banks
abihty to maintain critical continuity of essentialprogramsand policies.
Unlike large Federal departmentsand agencieswith a reservoir of
support personnelto maintain continuity of programsand operations,
Ex-Im Bank does not have the luxury of such staff.
We believe that the methodology used to determineannual attrition
rates for core employeesdoes not frilly reflect the Bank’s losses. In
fiscal years where the Bank offered buyouts, it appearsthat the number
of buyouts in core positions has not been consideredin calcuiating the
percentageof attrition. We believe that actual attrition rates better
EXPORT-IMPORT
SANK OFTHE UNITED STATES
811 VULHONTAYENU+N.W. Wmwxm. 0.C 20571
1 (&X3) 5654X&i (202) 565-3946 FAX: (202) 56%1380
GAO/GGD-97-104R Attrition Rates at Ex-lm Bank and Similar Agencies
12
ENCLOSCRE II EXCLOSURE 11
reflect the impact on the Bank and its operation. Virtually each and
every loss in the mainline occupations impacts upon the Bank’s ability to
carry out its mission.
Your report includes figures up to September30, .1996. You
should also be aware that thus far in FY 199’7there have been eleven
(11) core professional lossesand ten (10) administrative losses in the
Bank. We are currently projecting an additional loss of 8-10 core
professional employeesbefore the end of the year, an attrition rate for
core employeesof over 10%.
Thank you for the opportunity to comment on the draft report.
S,mcerely,
-I JamesIS. Hess
?hief Financial Officer
2
GAO/GGD:97-104R Attrition Rates at Ex-Im Bank and Similar Agencies
13
ENCLOSURE III ENCLOSUREIII
COMMENTSFROMTHEAGENCYFORINTERNATIONALDEVELOPMENT
* . -.
y!JJ
wgw
c 5%AGENCY FOR
bXERN.4llON.4L
DEVELOPNENT
MAY I4 m-i'
L. Nye Stevens
Director
Federal Management and
Workforce Issues
US General Accounting Office
Washington, D. C. 20548
Attn: Mr. Thomas Davies, Evaluator-in-Charge
Dear Mr. Stevens:
I am writing on behalf of J. Brian Atwood, Administrator,
U.S. Agency for International Development (USAID), regarding your
draft report "Federal Workforce: Attrition Rates at Ex-Im Bank
and Similar Agencies."
On first reading, USAID's Civil Service attrition rates
looked overstated in figures 1.1, 1.2 and 1.4 of the draft.
Through discussions with Mr. Davies, Evaluator-in-Charge, we have
learned that, for purpose of this study, attrition represents
exits only, not net change (exits plua replacements.) This needs
to be highlighted in the report and on the figures so that the
reader has a clearer understanding of what the data are
reporting.
USAID conducted a major reduction-in-force (RIF) in Fiscal
Year 1996. This makes USAID unique with regards to the other
agencies in this study. This RIF happened after several years of
downsizing. From September 30, 1992, to March 31, 1997, USAID's
Civil Service has gone from 1659 to 1276, a decrease of 383 or
23.1 per cent. I would like this information included in the.
report. It provides necessary context.
.Thank you for providing USAID with the opportunity to
comment on the draft report.
Linda N. Lion
Deputy Assistant Administrator
for Human Resources
(410118) 320Txea~-F~Snerr,u.w..w~~mcro~D.C.20523
GAOIGGD-97-104R Attrition Rates at Ex-Zm Bank and Similar Agencies
14
Ordering Information
The first copy of each GAO report and testimony is free.
Additional copies are $2 each. Orders should be sent to the
following address, accompanied by a check or money order
made out to the Superintendent of Documents, when
necessary. VISA and Mastercard credit cards are accepted, also.
Orders for 100 or more copies to be mailed to a single address
are discounted 25 percent.
Orders by mail:
U.S. General Accounting Office
P.O. Box 6015
Gaithersburg, MD 208846015
or visit:
Room 1100
700 4th St. NW (corner of 4th and G Sts. NW)
U.S. General Accounting Office
Washington, DC
Orders may also be placed by calling (202) 512-6000
or by using fax number (301) 258-4066, or TDD (301) 413-0006.
Each day, GAO issues a list of newly available reports and
testimony. To receive facsimile copies of the daily list or any
list from the past 30 days, please call (202) 512-6000 using a
touchtone phone. A recorded menu will provide information on
how to obtain these lists.
For information on how to access GAO reports on the INTERNET,
send an e-mail message with “info” in the body to:
info@www.gao.gov
United States
General Accounting Office
Washington, D.C. 20548-0001
Official Business
Penalty for Private Use $300
Address Correction Requested
Federal Workforce: Attrition Rates at Ex-Im Bank and Similar Agencies
Published by the Government Accountability Office on 1997-05-20.
Below is a raw (and likely hideous) rendition of the original report. (PDF)