United States General Accounting Office

GAO Report to the Chairman, Committee on

the Budget, House of Representatives

November 1995 DEFENSE ACQUISITION

ORGANIZATIONS

Changes in Cost and Size

of Civilian Workforce

GAO/NSIAD-96-46

GAO United States

General Accounting Office

Washington, D.C. 20548

National Security and

International Affairs Division

B-266019 

November 13, 1995

The Honorable John R. Kasich

Chairman, Committee on the Budget

House of Representatives

Dear Mr. Chairman:

As you requested, we developed information on the composition and the

cost of the workforce in the Department of Defense (DOD) acquisition

organizations. This report also summarizes selected aspects of the civilian

workforce in these acquisition organizations from 1980 though 1994.

Appendix I lists DOD’s acquisition organizations discussed in this report.

Results in Brief In 1994, DOD acquisition organizations, including the Defense Contract

Audit Agency, had a combined workforce of about 464,000—398,000

civilian and 66,000 military personnel.1

 In addition to acquisition missions,

the acquisition organizations have other significant roles and related

responsibilities, such as logistics, maintenance, and supply. The workforce

represents such “white collar” occupational fields as engineering,

contracting, accounting, and computer specialization. It also includes such

“blue collar” occupations as machine tool operators, pipefitters, shipyard

workers, and warehouse personnel. Within this workforce, there are about

41,000 supervisors, or 1 supervisor for every 9 staff members.

The civilian workforce in DOD’s acquisition organizations increased with

the defense buildup of the early 1980s and decreased following the

reductions that began in the mid-1980s.2

 In 1994, DOD’s civilian acquisition

workforce had about 53,000 fewer employees (12 percent lower) than in

1980. However, this decline occurred without a commensurate decline in

civilian payroll costs (measured in constant 1996 dollars), due in part to

the significant decline in blue collar workers. In addition, DOD officials

stated that civilian payroll costs increased because of many factors, such

as the advent of locality pay and changes in grade structure.

1

DOD Instruction 5000.58 lists the acquisition organizations, including the Special Operations

Command. (See app. I for a complete list.) The Special Operations Command is excluded from our

review, because, according to DOD acquisition officials, the Command is one of nine unified

commands in the military’s combatant command structure. We included the Defense Contract Audit

Agency because it is responsible for accounting and financial advisory services in connection with

negotiating, administering, and settling contracts and subcontracts.

2

We used DOD’s obligational authority to measure the defense buildup. Obligational authority includes

(1) research, development, test, and evaluation; (2) operations and maintenance; and (3) procurement.

Page 1 GAO/NSIAD-96-46 Defense Acquisition Organizations
B-266019 

Against the backdrop of the civilian workforce decline in DOD’s acquisition

organizations, defense-wide contract awards for services increased about

$10 billion since 1980 (measured in constant 1996 dollars).3

 About

$4 billion of this increase was for engineering/architectural and computer

services—two large occupational groups in the acquisition organizations.

Some of the savings from staff reductions in the acquisition organizations

may have been offset by increases in contract awards for similar services.

Even with declines in both the defense procurement budget and the

civilian workforce since 1990, the number of acquisition organizations

remains relatively constant. DOD officials stated that it is possible that the

workforce in the acquisition organizations will increase as it has in the

past with the expected increase in the defense procurement budget.

However, each acquisition organization maintains similar occupational

fields in common areas, such as personnel, budgeting, computer

specialists, and contracting, and many of the duties performed in these

occupations are not unique to an acquisition organization’s mission. As a

result, there may be opportunities to improve efficiencies in these areas.

(See app. II.)

Agency Comments DOD generally concurs with the information contained in the draft report.

DOD stated that the acquisition organizations have a variety of missions.

DOD stated that the results of our review reflect the combination of these

missions. DOD also stated that many dynamics contribute to the changes in

the workforce over time. For example, when the civilian workforce

decreased in the DOD acquisition organizations, defense-related

employment in industry increased, resulting in a net shift of work to the

private sector. DOD’s comments are presented in their entirety in 

appendix III.

Scope and

Methodology

To examine the composition of the defense acquisition workforce, we first

interviewed DOD officials associated with the major defense acquisition

organizations. We then obtained employment levels from 1980 to 1994

stratified by organization, occupational series, and management and

supervisory levels from the Defense Manpower Data Center. We also

reviewed data found in other studies on the defense acquisition workforce.

3

Constant dollars measure the value of goods and services at price levels that are the same as the base

year. Changes in constant dollar values therefore reflect changes in the volume of goods and services,

not changes due to inflation.

Page 2 GAO/NSIAD-96-46 Defense Acquisition Organizations
B-266019 

To examine the cost of the acquisition workforce, we reviewed

compensation data from the National Defense Budget Estimates for Fiscal

Year 1996. To examine trends in contract awards for services, supplies,

and equipment, we retrieved contract data from DOD’s Individual

Contracting Action Report stratified by year. Budget, payroll, and contract

data were converted to constant 1996 dollar figures.

We conducted our work from June 1995 through September 1995 in

accordance with generally accepted government auditing standards.

We are sending copies of this report to the Ranking Minority Member of

the House Committee on the Budget, the Secretary of Defense, and other

interested parties. We will make copies available to others upon request. If

you have any questions concerning this report, please call me on

(202) 512-4587. See appendix IV for a listing of major contributors to this

report.

Sincerely yours,

David E. Cooper

Director, Acquisition Policy, Technology, and

 Competitive Issues

Page 3 GAO/NSIAD-96-46 Defense Acquisition Organizations
Contents

Letter 1

Appendix I 

List of Defense

Acquisition

Organizations

6

Appendix II 

Civilian Workforce

Profile of DOD

Acquisition

Organizations

7

Appendix III 

Comments From the

Department of

Defense

24

Appendix IV 

Major Contributors to

This Report

26

Figures Figure II.1: Comparison of Trends in Civilian Workforce in

Acquisition Organizations to Obligational Authority

7

Figure II.2: DOD Total Civilian Workforce Compared With

Civilian Workforce in DOD Acquisition Organizations

8

Figure II.3: Professional Acquisition Workforce and Other

Civilians in Acquisition Organizations, Fiscal Year 1994

9

Figure II.4: Selected Occupational Fields in Acquisition

Organizations, Fiscal Year 1994

10

Figure II.5: Selected Occupational Fields in Acquisition

Organizations, Fiscal Year 1994

11

Figure II.6: Extent of Changes in Work Force of Acquisition

Organizations

12

Figure II.7: Civilian Payroll for Acquisition Organizations 13

Page 4 GAO/NSIAD-96-46 Defense Acquisition Organizations
Contents

Figure II.8: Per Capita Payroll for the Civilian Workforce in

Acquisition Organizations

14

Figure II.9: Percentage Change in White Collar and Blue Collar

Civilian Workforce in Acquisition Organizations

15

Figure II.10: Percentage Change From 1980 of Civilian Workforce

and Payroll in Acquisition Organizations

16

Figure II.11: DOD’s Streamlining Goals for Civilian Supervisory

Ratios

17

Figure II.12: DOD Contract Dollars for Products Versus Services 18

Figure II.13: DOD Contract Actions for Products Versus Services 19

Figure II.14: Contracts for Services as a Percentage of Total DOD

Contract Dollars

20

Figure II.15: Number of Engineers and Computer Specialists

Declined in Acquisition Organizations

21

Figure II.16: DOD Contracts for Engineering/Architectural and

Computer Services

22

Figure II.17: Comparison of Civilian Workforce in Acquisition

Organizations to Procurement Budget

23

Abbreviations

AFMC Air Force Material Command

AISC Army Information Systems Command

AMC Army Materiel Command

ASSDC Army Space and Strategic Defense Command

BMDO Ballistic Missile Defense Organization

DCAA Defense Contract Audit Agency

DLA Defense Logistics Agency

DOD Department of Defense

NAVAIR Naval Air Systems Command

NAVFAC Naval Facilities Engineering Command

NAVSEA Naval Sea Systems Command

NAVSUP Naval Supply Systems Command

ONR Office of the Chief of Naval Research

PEO Program Executive Office

SPAWAR Space and Naval Warfare Systems Command

Page 5 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix I 

List of Defense Acquisition Organizations

The Department of Defense (DOD) Instruction 5000.58 states that an

acquisition organization is an organization, including its subordinate

elements, whose mission includes planning, managing, and/or executing

acquisition programs that are governed by DOD Directive 5000.1 (reference

(n)), DOD Instruction 5000.2 (reference (o)), and related issuances.

Specifically, these organizations are as follows (and any successor

organizations of these commands):

• Office of the Under Secretary of Defense (Acquisition and Technology)

• Army Materiel Command (AMC)

• Army Information Systems Command (AISC)

• Army Strategic Defense Command [now Army Space and Strategic

Defense Command (ASSDC)]

• Army Acquisition Executive

• Office of the Assistant Secretary of the Navy (Research, Development, and

Acquisition)

• Naval Sea Systems Command (NAVSEA)

• Naval Air Systems Command (NAVAIR)

• Naval Supply Systems Command (NAVSUP)

• Naval Facilities Engineering Command (NAVFAC)

• Office of the Chief of Naval Research (ONR)

• Space and Naval Warfare Systems Command (SPAWAR)

• Navy Strategic Systems Program Office

• Navy Program Executive Officer/Direct Reporting Program Manager

Organization

• Marine Corps Research, Development, and Acquisition Command

• Office of the Assistant Secretary of the Air Force (Acquisition)

• Air Force Systems/Air Force Logistics Commands [now Air Force Material

Command (AFMC)]

• Air Force Program Executive Organization

• Defense Logistics Agency (DLA)

• Strategic Defense Initiative Organization [now Ballistic Missile Defense

Organization (BMDO)]

• Special Operations Command

The Special Operations Command is excluded from our review, because,

according to DOD acquisition officials, the Command is one of nine unified

commands in the military’s combatant command structure. We included

the Defense Contract Audit Agency (DCAA) because it is responsible for

accounting and financial advisory services in connection with negotiating,

administering, and settling contracts and subcontracts.

Page 6 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.1: Comparison of Trends in

Civilian Workforce in Acquisition

Organizations to Obligational

Authority (Workforce in Thousands,

Obligational Authority Dollars in Billions)

80 82 84 86 88 90 92 94

0

150

300

450

600

Fiscal year

Obligational authority Workforce

The civilian workforce in DOD’s acquisition organizations increased with

the defense buildup of the early 1980s and decreased with the downsizing

(measured in obligational authority) beginning in the mid-1980s.1

 Overall,

DOD’s 1994 civilian acquisition workforce was about 12 percent smaller

than in 1980 or about 53,000 fewer employees.

1

We used DOD’s obligational authority to measure the defense budget trends. Obligational authority

includes research, development, test, and evaluation; operations and maintenance; and procurement.

Page 7 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.2: DOD Total Civilian

Workforce Compared With Civilian

Workforce in DOD Acquisition

Organizations (Workforce in Thousands)

80 82 84 86 88 90 92 94

0

300

600

900

1,200

Fiscal year

 Workforce

Acquisition civilians DOD civilians

DOD’s civilian workforce in the acquisition organizations averaged about

47 percent of DOD’s total civilian workforce from 1980 through 1994.

Page 8 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.3: Professional Acquisition

Workforce and Other Civilians in

Acquisition Organizations, Fiscal Year

1994 (Workforce in Thousands)a

BMDO

ASSDC

Secretariats

ONR

PEOs

DCAA

AISC

SPAWAR

NAVSUP

NAVFAC

NAVAIR

DLA

AMC

AFMC

NAVSEA

0 15 30 45 60 75 90

Workforce

Professional acquisition All others

aSecretariats include: Office of the Under Secretary of Defense (Acquisition and Technology);

Office of the Assistant Secretary of the Navy (Research, Development, and Acquisition); Office of

the Assistant Secretary of the Air Force (Acquisition); and the following two organizations due to

their relatively small size, the Marine Corps Research, Development, and Acquisition Command

and the Navy Strategic Systems Program Office.

The Defense Acquisition Work Force Improvement Act of 1990 

(P.L. 101-510, title XII) required the Secretary of Defense to designate

professional acquisition personnel for each of the military departments.

About 20 percent of the workforce in defense acquisition organizations

has been designated the professional acquisition workforce.

Page 9 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.4: Selected Occupational

Fields in Acquisition Organizations,

Fiscal Year 1994 (Workforce in

Thousands)

Pipefitting

Aircraft overhaul

Machine tooling

Industrial equipment

Metal working

Electronics

Packing/warehousing

Personnel

Physical Sciences

Facilities

Quality assurance

Computers

Accounting/budgeting

Supply

Business/industry

Administrators

Architects/engineers

0 20 40 60 80 100

Workforce

Professional acquisition Others

Blue collar

White collar

The occupational groups in the professional acquisition corps consist

mainly of engineering and architecture, general administration, business

and industry (contracting officers), supply, accounting and budgeting, and

computer specialization. Occupations excluded from the professional

corps include blue collar workers, such as packing and warehouse

personnel, electronic technicians, metal workers, and industrial equipment

maintenance workers.

Page 10 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.5: Selected Occupational

Fields in Acquisition Organizations,

Fiscal Year 1994 (Workforce in

Thousands)

BMDO

ASSDC

Secretariats

ONR

PEOs

SPAWAR

AISC

NAVFAC

NAVSUP

NAVAIR

DCAA

NAVSEA

AMC

AFMC

DLA

0 1 2 3 4 5 6 7 8 9

Workforce

Personnel Computers Accounting/budgeting Contracting

Almost all these acquisition organizations have employees in at least the

following occupational groups: personnel management, computer

specialist, accounting and budgeting, and contracting. These occupations

generally do not fulfill the agencies’ primary mission, except that

employees in accounting do carry out the basic functions of DCAA.

Page 11 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.6: Extent of Changes in Work

Force of Acquisition Organizations

(Workforce in Thousands)

Workforce 

decline 

since 

1990

Workforce 

growth 

since 

1990

PEOs

NAVFAC

Secretariats

BMDO

ASSDC

ONR

DCAA

DLA

NAVAIR

NAVSUP

AISC

NAVSEA

SPAWAR

AFMC

AMC

-30 -15 0 15 30

Workforce

Change from 1990 to 1994

Many acquisition organizations experienced a reduction in their staffs

from 1990 to 1994. Despite an overall decline in staff, the acquisition

organizations listed in figure II.6 continue to exist.

Page 12 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.7: Civilian Payroll for

Acquisition Organizations (Constant

1996 Dollars in Billions)

80 82 84 86 88 90 92 94

0

5

10

15

20

25

Fiscal year

From 1980 through 1994, the average annual cost of the civilian workforce

in the acquisition organizations was about $22 billion, ranging from

$20 billion to $23 billion. With the decline in the civilian workforce,

average annual payroll costs returned to the 1980 level of about $20 billion,

measured in 1996 constant dollars.

Page 13 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.8: Per Capita Payroll for the

Civilian Workforce in Acquisition

Organizations (Constant 1996 Dollars in

Billions)

80 82 84 86 88 90 92 94

0

15

30

45

60

Fiscal year

In 1980, the per capita salary averaged $44,000, whereas, in 1994, the per

capita salary averaged $51,000 in constant dollars.

Page 14 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.9: Percentage Change in

White Collar and Blue Collar Civilian

Workforce in Acquisition

Organizations (Percentage Change

From 1980)

80 82 84 86 88 90 92 94

-20

-10

0

10

20

30

Blue collar White collar

Comparison of the 1980 and 1994 civilian workforce shows a reduction in

blue collar employees. There are over 62,000 fewer blue collar workers

and over 9,000 more white collar workers in 1994 than there were in 1980.

Page 15 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.10: Percentage Change From

1980 of Civilian Workforce and Payroll

in Acquisition Organizations

(Percentage Change From 1980)

80 82 84 86 88 90 92 94

-20

-10

0

10

20

Workforce change from 1980 Payroll change from 1980

The 1994 civilian workforce was about 12 percent below the 1980 level

without a commensurate reduction in payroll. From 1982 to 1992, the

workforce and payroll moved commensurately; however, in 1993 and 1994,

the workforce decreased without a commensurate reduction in overall

payroll.

Page 16 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.11: DOD’s Streamlining Goals

for Civilian Supervisory Ratios

(Employees Per Supervisor)

93 94 95 96 97 98 99

0

5

10

15

Fiscal year

Goal Actual 1994 

The acquisition organizations had about 41,000 supervisors, or 1 for every

9 staff members in 1994. Thus, they exceeded the 1994 goal of one

supervisor for every seven staff members reported in DOD’s Defense

Streamlining Plan, dated October 1994. DOD expects workforce savings to

occur by improving supervisory ratios to 1 supervisor for every 14 staff

members by 1999. While DOD has eliminated about 5,700 supervisors since

1980, its nonsupervisory high-grade personnel has increased about 11,000.

If DOD continues to decrease the number of supervisors, but increase the

number of nonsupervisory high-grade employees, it may achieve its

supervisory ratio goals, but may not sufficiently reduce the acquisition

infrastructure.

Page 17 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.12: DOD Contract Dollars for

Products Versus Services (Constant

1996 Dollars in Billions)

80 82 84 86 88 90 92 94

0

40

80

120

160

200

Fiscal year

Services Products

In 1994, defense contract awards for services increased almost $10 billion

(measured in constant 1996 dollars) over the 1980 level, while defense

contract awards for products decreased about $23 billion from the 1980

level and decreased about $74 billion from the 1985 peak.

Page 18 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.13: DOD Contract Actions for

Products Versus Services (Contract

Actions in Thousands)

80 82 84 86 88 90 92 94

50

100

150

200

Fiscal year

Services Products

The number of contract actions for services exceeded the number of

contract actions for products in 1994. The number of contract actions for

services in 1994 was almost 120,000, whereas in 1980 the number of

contract actions for services was about 65,000.

Page 19 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.14: Contracts for Services as

a Percentage of Total DOD Contract

Dollars

80 82 84 86 88 90 92 94

0

5

10

15

20

25

30

35

40

Fiscal year

Of DOD contract awards above $25,000, the dollar amounts of contract

awards for services in 1994 increased to 37 percent from the 1980 level of

27 percent.

Page 20 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.15: Number of Engineers and

Computer Specialists Declined in

Acquisition Organizations (Workforce in

Thousands)

80 82 84 86 88 90 92 94

0

25

50

75

100

Fiscal year

Computer specialists Engineers

Since 1990, the number of in-house engineers and computer specialists

declined in the acquisition organizations—two occupational groups in the

professional acquisition corps. Although in-house engineers and computer

specialists increased from 1980 to 1990, since 1990 there has been a

decline, namely computer specialists decreased from 16,000 to about

12,000 and engineers decreased from about 87,000 to about 75,000.

Page 21 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.16: DOD Contracts for

Engineering/Architectural and

Computer Services (Constant 1996

Dollars in Billions)

90 91 92 93 94

1.5

2

2.5

3

3.5

Fiscal year

Engineers and architects Computer services

Contracts for engineering/architectural and computer services—two

occupational groups in the acquisition organizations—increased from 1990

to 1994. This raises the question about whether savings from staff

reductions from 1990 to 1994 were offset by increases in contract awards

for services.

Page 22 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix II 

Civilian Workforce Profile of DOD

Acquisition Organizations

Figure II.17: Comparison of Civilian

Workforce in Acquisition

Organizations to Procurement Budget

(Procurement Dollars in Billions;

Workforce in Thousands)

80 83 86 89 92 95 98 01

0

150

300

450

600

Fiscal year

Procurement Workforce

Projection A

Projection B

As shown in figure I.1, Comparison of Trends in Civilian Workforce in

Acquisition Organizations to Obligational Authority, the civilian workforce

in the acquisition organizations increased with the defense buildup of the

early 1980s and declined with the downsizing beginning in the late 1980s.

In August 1994, DOD prepared an estimate that the workforce will decrease

through 2001. More recently, DOD officials stated that it is possible that the

workforce will increase as it has in the past with the expected increase in

the defense procurement budget contained in DOD’s Future Year Defense

Plan.

Page 23 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix III 

Comments From the Department of Defense

Page 24 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix III 

Comments From the Department of Defense

Page 25 GAO/NSIAD-96-46 Defense Acquisition Organizations
Appendix IV 

Major Contributors to This Report

National Security and

International Affairs

Division, Washington,

D.C.

Ralph Dawn

Julia Kennon

James Morrison

Leslie Schafer

Katherine Schinasi

Clifton Spruill

Cincinnati Regional

Office

Johnetta GatlinBrown

Myra Watts

(705109) Page 26 GAO/NSIAD-96-46 Defense Acquisition Organizations
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