Federal Workforce: Lessons Learned for Engaging Millennials and Other Age Groups
Published: 2016-09-29T00:00:00

Fast Facts:
Avoiding a "brain drain" in the federal workforce
With more than 30% of federal employees eligible to retire by 2019, a lot of jobs could open up that the current federal workforce can't fill. So, the government needs to recruit and retain the next generation of workers.
Strong employee engagement—a positive feeling about one's employer and its mission—tends to help agencies hire and keep employees. You might think that millennials are less engaged than other age groups, but the data in this testimony showed that engagement doesn't vary much by age. Engagement increases for everyone when agencies demonstrate that they value their employees.

Highlights:
section_title: Why GAO Did This Study
paragraphs: GAO's prior work found that skills gaps in government-wide fields such as cybersecurity are threatening the ability of agencies to carry out their missions. At the same time, government-wide trends in federal workforce retirement threaten to aggravate the problem. To help ensure agencies have the capacity to address complex national challenges, agencies need to be competitive for top talent, including those in the millennial generation.
This testimony examines (1) recent employment trends of millennials in the federal workforce and how they compare to other employee cohorts; (2) trends in engagement levels of millennials versus other employee groups; and (3) the drivers of federal employee engagement and the key lessons learned for building a culture of engagement.
This statement is based on GAO's 2015 review of the trends and drivers of government-wide employee engagement and our larger body of work on federal human capital, issued primarily between January 2014 and September 2016, and is updated with more recent information. Millennials are commonly considered as those born between the early 1980s and 2000. However, for the purposes of this statement GAO is including all employees 39 years old and younger as millennials in order to provide a consistent definition across datasets.
GAO is not making any new recommendations in this testimony. We have previously made recommendations to the Office of Personnel Management (OPM) to improve engagement government-wide, which OPM has implemented.
section_title: What GAO Found
paragraphs: Employees 39 years of age and younger represented approximately 45 percent of the United States employed civilian labor force and about 30 percent of the civilian federal workforce in fiscal year 2014. This group includes the millennial generation. The percent of millennials within the federal workforce varies by agency and agencies that have high rates of retirement eligibility also tend to have low percentages of millennials in the workforce.
In 2015, millennial employees in the federal government had an estimated Employee Engagement Index (EEI) score of 63.8 – as derived from the Office of Personnel Management's Federal Employee Viewpoint Survey – which is less than one percentage point lower than non-millennials. Engagement is usually defined as the sense of purpose and commitment employees feel towards their employer and its mission. As shown in the figure below, millennial subgroups had both the highest and lowest EEI scores among all age groups in 2015—employees 25 and younger had the highest EEI score (70.8), while employees 30 to 39 years old had the lowest EEI score (63.3).
Key drivers of engagement can help agencies develop a culture of engagement. GAO's regression analysis identified six practices as key drivers of the EEI, which were similar for both millennials and non-millennials: (1) constructive performance conversations, (2) career development and training, (3) work-life balance, (4) inclusive work environment, (5) employee involvement, and (6) communication from management. As GAO found in a 2015 report on employee engagement, building a culture of engagement involves effective management strategies such as leadership involvement, strong interpersonal skills of supervisors, and thoughtful use of data.

section_title: Letter
paragraphs: Thank you for the opportunity to be here today to discuss recruiting and  retaining millennials in the federal government. As you know, federal  agencies are facing critical human capital management challenges. In our  prior work we noted how skills gaps in such government-wide fields as  cybersecurity, acquisition management, and telecommunications, as well  as in such agency-specific positions as nurses and physicians, are  jeopardizing the ability of agencies to cost-effectively carry out their  missions. At the same time, trends in retirement eligibility threaten to  aggravate the problem of skills gaps. Across government, almost a third  of permanent career employees on-board as of September 30, 2014, will  be eligible to retire by 2019.
The importance of a top-notch federal workforce cannot be overstated.  The nation continues to face new and more complex social, economic,  and security challenges, and all of these issues will need to be addressed  in an environment of a large and long-term fiscal imbalance that will put  resource constraints on most agencies. Moreover, as we have pointed  out in our High-Risk Series and other reports for Congress, some federal  agencies continue to face ongoing performance and accountability  problems at a time when taxpayers have come to expect—and need— higher levels responsiveness by public programs and officials.
To help ensure agencies have the capacity to address these challenges,  it will be important for them to recruit and retain employees able to thrive  in organizations that are flatter, results-oriented, and externally focused,  and that collaborate with other governmental entities as well as with the  private sector to achieve desired outcomes. In short, agencies need to be  competitive in the labor market for top talent, including millennials. Based  on our work and that of other organizations, this means going beyond  merely attracting and hiring quality candidates; rather, it calls for a robust  talent management strategy that covers the full life-cycle of federal  employment and includes such key components as: data-driven workforce and succession planning; effective on-boarding programs;  results-oriented training and development; meaningful performance management; comparable pay and benefits; and a culture of employee engagement.
In my remarks today, I will focus on this last component: employee  engagement. A growing body of research on both private- and public- sector organizations has found that increased levels of engagement— generally defined as the sense of purpose and commitment employees  feel toward their employer and its mission—can lead to better  organizational performance. Specifically, I will discuss (1) recent  employment trends of millennials in the federal workforce and how they  compare to other employee cohorts; (2) trends in engagement levels of  millennials versus other employee groups; and (3) the drivers of federal  employee engagement based on our 2015 report and key lessons  learned for building a culture of engagement to help strengthen agencies’  recruitment and retention efforts.
My statement is based on our review of the trends and drivers of  government-wide employee engagement conducted between 2014 and  2015 and our larger body of work on federal human capital management  issued primarily between January 2014 and September 2016 and is  updated with more recent information as appropriate. For example, to  update the trends and drivers of employee engagement we analyzed  2015 results from the Federal Employees Viewpoint Survey (FEVS). To  update the federal civilian employment trend information, we analyzed  fiscal year 2014 data from the Office of Personnel Management’s (OPM)  Enterprise Human Resources Integration (EHRI) Statistical Data Mart.
To provide consistent breakouts by age for both engagement and  employment trend data, we used age groups established by OPM in the  FEVS. These 6 groups are: 25 years old and younger, 26 to 29 years old,  30 to 39 years old, 40 to 49 years old, 50 to 59 years old, and 60 years  old and older. In defining the millennial generation for purposes of this  statement we chose to group results from employees in 3 age groups: 25  years old and younger, 26 to 29 years old, and 30 to 39 years old.  Therefore, our definition of millennial is much broader than the typical  definition but we believe the value of consistency across our analysis  outweighs the disadvantages of including 30 to 39 year olds as  millennials.
For our 2015 report on employee engagement we reviewed documents  and interviewed officials from three case study agencies. To select these  agencies, we considered the agencies that had the highest average  sustained Employee Engagement Index (EEI) scores, most improved  overall EEI scores, and most improved leadership component scores in  the EEI from 2010 to 2014. We selected the National Credit Union  Administration (NCUA), the Federal Trade Commission (FTC), and the  Department of Education (Education) to ensure that we included agencies  that had high scores in one or more of the three metrics we identified and  that we included at least one Chief Financial Officers Act of 1990 (CFO  Act) agency.
Detailed descriptions of the scope and methodology can be found in the  original reports cited throughout this statement. The work that this  statement is based on was conducted in accordance with generally  accepted government auditing standards. Those standards require that  we plan and perform the audit to obtain sufficient, appropriate evidence to  provide a reasonable basis for our findings and conclusions based on our  objectives. We believe that the evidence obtained provides a reasonable  basis for our findings and conclusions based on our audit objectives.
subsections: section_title: Background
paragraphs: Compared to the U.S. employed civilian labor force, the federal  government’s workforce is made up of fewer millennials. In 2014, people  39 years old and younger represented 44.8 percent of the U.S. employed  civilian labor force and 29.6 percent of the total civilian federal  government workforce (see figure 1). The differences were greatest for  the youngest portion of millennials.
The increase of the number of millennials of working age has coincided  with several events in the federal government—such as hiring freezes,  sequestration, furloughs and a 3-year freeze on statutory annual pay  adjustments from 2011 to 2013—that OPM and others contend negatively  affected federal employee morale and limited opportunities for new  employees to join the federal government. According to results from  OPM’s Federal Employee Viewpoint Survey (FEVS), government-wide  levels of employee engagement declined from an estimated 67 percent in  2011, to an estimated 63 percent in 2014, and increased to 64 percent in  2015, as measured by a score OPM derived from the FEVS beginning in  2010—the Employee Engagement Index (EEI).
OPM has conducted the FEVS—a survey that measures employees’  perceptions of whether, and to what extent, conditions characterizing  successful organizations are present in their agencies—every year since  2010. The EEI is composed of 15 FEVS questions covering the  following areas:
Leaders lead, which surveys employees’ perceptions of the integrity of  leadership, as well as employees’ perception of leadership behaviors  such as communication and workforce motivation.
Supervisors, which surveys employees’ perceptions of the  interpersonal relationship between worker and supervisor, including  trust, respect, and support.
Intrinsic work experience, which surveys employees’ feelings of  motivation and competency relating to their role in the workplace.
According to OPM, the EEI does not directly measure employee  engagement. Instead it covers the conditions that lead to employee  engagement. Specifically, OPM noted that organizational conditions lead  to feelings of engagement, which in turn lead to engagement behaviors,  such as discretionary effort, and then to optimum organizational  performance.
Engaged employees are more than simply satisfied with their jobs.  According to employee engagement literature, engaged employees  take pride in their work, are passionate about and energized by what they do, are committed to the organization, the mission, and their job, and are more likely to put forth extra effort to get the job done.
section_title: Demographic Shifts and Evolving Nature of Federal Work May Challenge Agencies’ Capacity to Meet Their Mission
paragraphs: In 2014, we reported that in the face of limited budgets, some agencies  had reduced hiring. The Budget Control Act of 2011 established a 10- year cap on discretionary spending through 2021, but many agencies had  experienced flat or declining budgets for several years prior. During that  time, employment data show the following trends:  From fiscal years 2008 to 2014, the total number of new federal  employees hired decreased by 33 percent, from approximately 164,000 to  110,000 employees per fiscal year.
Employees 25 years old and younger have experienced the largest  decrease with 58 percent fewer hired in 2014 than in 2008 (see figure  2).
For the entire millennial cohort (39 years old and younger), the  decrease in hiring is similar to that of the non-millennial cohort  (decreases of 34 and 32 percent, respectively).
Compared to non-millennials, a greater percentage of millennials have  non-permanent positions in the federal government than non- millennials. Examples of non-permanent positions include  appointments that are term-limited or temporary such as park rangers  or interns. In fiscal year 2014, 42 percent of employees 25 years old  and younger and 15 percent of employees 26 to 29 years old held  non-permanent positions. Across all age groups, 7 percent of  employees in the federal government were in non-permanent  positions.
subsections: section_title: Turnover Decreased Across All Age Groups since Fiscal Year 2000, Although Millennials Had Slightly Higher Attrition Rates
paragraphs: Attrition rates for all age groups were much higher in the early 2000s than  they were in fiscal year 2014.
For example, in fiscal year 2000, when millennials were just entering  the workforce, 19 percent of permanent career employees 25 years  and younger with 5 years or less of federal service resigned or  separated, compared to 9.3 percent in fiscal year 2014 (see figure 3).  Two economic recessions have occurred since 2000 (in 2001 and  from 2007 to 2009) and may have contributed to declining attrition  rates.
In the federal government millennial attrition rates are slightly higher than  other age groups, even when controlling for tenure.
In fiscal year 2014, 9.3 percent of millennials 25 years old and  younger who held permanent career positions for 5 years or less  resigned or separated from the federal government. Fewer millennials  26 to 29 years old and 30 to 39 years old with 5 years or less of  federal service left the government, with 7.0 percent and 6.3 percent,  respectively, resigning or separating in fiscal year 2014.
Non-millennial permanent career employees (age 40 and older) with 5  years or less of federal service had an attrition rate of 5.1 percent in  fiscal year 2014, not including retirements.
While many factors affect when a person actually retires, in 2015, we  reported that across the government, 31 percent of the career permanent  career employees on board as of September 2014 would be eligible to  retire by September 2019. About 23 percent of Department of  Homeland Security staff on board as of September 2014 will be eligible to  retire in 2019, while more than 43 percent will be eligible to retire at both  the Department of Housing and Urban Development and the Small  Business Administration (see figure 4). Certain occupations—such as air  traffic controllers, customs and border protection agents, and those  involved in implementing government programs—will also have  particularly high retirement-eligibility rates by 2019.
As retirements of federal employees continue, some agencies with few  millennials may face future gaps in leadership, expertise, and critical skills  because millennials represent the next generation of workers.
As with retirement eligibility, the percent of millennials in the workforce  varies by agency. Millennials  (39 years old and younger) make up more  than 30 percent of the workforce at 8 of the 24 CFO Act agencies but less  than a quarter at 7 agencies (see figure 4 above). Agencies that have  high rates of retirement eligibility,  such as the Environmental Protection  Agency, also tend to have low percentages of millennials in the  workforce. Actual retirement rates began to decline at the end of 2007  with the recession to 3.3 percent in 2008, 2.5 percent in 2009, and 2.7  percent in 2010, before increasing again to 3.5 percent in 2014.
The large percentage of federal employees eligible for retirement creates  both an opportunity and a challenge for federal agencies. On the one  hand, as shown in our prior work, if accompanied with appropriate  strategic and workforce planning, it allows agencies to realign their  workforce with needed skills and leadership levels to better meet their  existing and any newly emerging mission requirements. On the other  hand, it means that agencies will need succession planning efforts as well  as effective sources and methods for recruiting and retaining candidates  in order to avoid a brain-drain and mission-critical skills gaps.
We have found that leading organizations go beyond a succession  planning approach that focuses on simply replacing individuals. Instead,  leading organizations engage in broad, integrated succession planning  and management efforts that focus on strengthening both current and  future organizational capacity. To do this, it will be important for agencies  to use workforce analytics to drive their decisions, as well as use  available flexibilities from Congress and OPM to acquire, develop,  motivate, and retain talent as needed.
section_title: Millennials Have Greater Representation in Certain Mission-Critical Occupations with Skills Gaps Compared to Proportion in the Workforce
paragraphs: Mission-critical skills gaps within specific federal agencies as well as  across the federal workforce pose a high risk to the nation because they  impede the government from cost-effectively serving the public and  achieving results. OPM and the Chief Human Capital Officer (CHCO)  Council established an interagency working group and identified skills  gaps in six government-wide, mission-critical areas: information  technology/cybersecurity specialist, contract specialist/acquisition,  economist, human resource specialist, auditor, and specialists in the  science, technology, engineering, and mathematics (STEM) functional  community.
With one exception, millennials 39 years old and younger represent a  greater percentage of employees in selected job series associated with  these mission-critical occupations compared to their proportion in the  workforce as a whole. Millennials  represent 29.6 percent of the federal  government workforce across all occupations in fiscal year 2014 (see  table 1). Millennials’  percentages in the economist, auditor, and contract  specialist job series are all greater than the government-wide average for  all occupations, by as much as almost 10 percentage points. However, for  human resources specialists, only 24.7 percent of the occupation is made  up of millennials.
Today’s federal jobs require more advanced skills, often at higher grade  levels than federal jobs 30 years ago. In 2014, we found that employees  working in professional (e.g., doctors and scientists) or administrative  positions (e.g., financial and program managers), which often require  specialized knowledge and advanced skills and degrees grew from 56  percent of the federal civilian workforce in 2004 to 62 percent in 2012.  Also, from 2004 to 2012, permanent career employees with a master’s or  professional degree saw a 55.7 percent increase.
A lower percentage of millennial employees 29 years old and younger in  the federal government have advanced degrees than older millennials (30  to 39 years old) or non-millennials. In fiscal year 2014, 2.1 percent of  permanent career millennials 25 years old and younger had advanced  degrees, compared to 12.3 percent of 26 to 29 year olds and 21.8 percent  of 30 to 39 year olds. One reason for these differences could be that  younger millennials have not had the time to obtain a more advanced  degree. Non-millennial permanent career employees were similar to older  millennial employees in that 21.9 percent had advanced degrees.
section_title: Millennial Engagement Scores Are Similar to Other Age Groups
paragraphs: Government-wide the estimated engagement level across all age groups  was 64 percent and engagement levels were similar between millennials  and other age groups. Millennial  EEI scores were 0.4 percentage points  lower than non-millennials in 2015, at 63.8 and 64.2 respectively. Key  findings from our analysis include the following:
Millennials  25 years old and younger had the highest estimated EEI  score across all age groups and were 7.6 percentage points higher  than the age group with the lowest score, the 30 to 39 age group.  However, employees age 25 and younger are a relatively small  portion of the federal workforce, comprising only 1.8 percent in fiscal  year 2014. In comparison, employees 30 to 39 years old comprised  21.4 percent of the federal workforce in fiscal year 2014 (see figure 5).
Engagement scores of millennials vary across agency but were  statistically higher than engagement scores of non-millennials at 14 of  24 CFO Act agencies in 2015. Engagement scores for millennials  were statistically lower than those of non-millennials at 3 agencies,  the U.S. Agency for International  Development, Department of  Defense, and Department of Homeland Security (DHS). There was no  statistically significant difference between the engagement scores of  millennials and non-millennials at the 7 remaining agencies  (Department of Agriculture, Department of Housing and Urban  Development, Department of Justice, Department of State,  Department of Treasury, the National Science Foundation, and the  Small Business Administration) (see figure 6).
The difference between EEI scores for millennials and non-millennials  was highest at the Department of Commerce, where millennial EEI  scores were approximately 5 percentage points higher than  engagement scores for non-millennials.
The range between the agencies with the highest and lowest  engagement scores was approximately 29 percentage points for  millennials and approximately 23 percentage points for non- millennials. The National Aeronautics and Space Administration had  the highest EEI scores, with millennials scoring approximately 16  percentage points higher than the government-wide average and non- millennials scoring approximately 14 percentage points higher.
DHS had the lowest engagement scores for both age groups— millennials scored approximately 13 percentage points lower than the  government-wide average and non-millennials scored approximately  10 percentage points lower. Despite low EEI scores for millennials, as  shown above in figure 4, DHS has the highest percentage (39.2  percent) of employees 39 years old and younger in their workforce,  compared to other CFO Act agencies.
subsections: section_title: Millennials Ranked Supervisors Higher than Non-Millennials, But Scored Lower in Intrinsic Work Experience
paragraphs: Among all employees, millennials had similar perceptions of leaders as  non-millennials, but, as shown in table 2, employees’ perceptions of  leaders consistently received the lowest score of the three components  that comprise the EEI. Millennials  had better perceptions of their  supervisors than non-millennials and the supervisors component saw the  highest scores in the EEI across all age groups in 2015. For the intrinsic  work experience component, however, non-millennials had higher scores  than millennials by more than three percentage points.
As we have shown in the analysis above, the employee-supervisor  relationship is an important aspect of employee engagement. FEVS  questions on the supervisors component focus on the interpersonal  relationship between worker and supervisor and concern supervisors’  support for employee development, employees’ respect, trust, and  confidence in their supervisor, and employee perceptions of an immediate  supervisor’s performance. This is consistent with U.S. Merit Systems  Protection Board (MSPB) research, which suggests that first-line  supervisors are key to employee engagement and organizational  performance.
Questions on intrinsic work experience reflect employees’ feelings of  motivation and competency related to their role in the workplace, such as  their sense of accomplishment and their perception of utilization of their  skills.
section_title: Lessons Learned for Driving Engagement Could Help Improve Recruitment and Retention
paragraphs: Overall we found that the drivers of engagement were similar for  millennials and non-millennials. What matters most in improving  engagement levels across all age groups is valuing employees—that is,  an authentic focus on their performance, career development, and  inclusion and involvement in decisions affecting their work. The key is  identifying what practices to implement and how to implement them,  which can and should come from multiple sources—FEVS and other data  sources, other agencies, and OPM.
subsections: section_title: Performance Conversations Are the Strongest Drivers of EEI Levels
paragraphs: Of the various topics covered by the FEVS that we analyzed, we  identified six that had the strongest association with higher EEI levels  compared to others for both millennials and non-millennials, as described  in figure 7. We used regression analysis to test which selected FEVS  questions best predicted levels of employee engagement as measured by  the GAO-calculated EEI, after controlling for other factors such as  employee characteristics and agency.
Constructive performance conversations. We found that having  constructive performance conversations was the strongest driver of the  EEI government-wide. For the question “My supervisor provides me with  constructive suggestions to improve my job performance,” we found that,  controlling for other factors, someone who answered “strongly agree” on  that FEVS question would have on average an engagement score that  was more than 20 percentage points higher, compared to someone who  answered “strongly disagree” on the 5-point response scale.
As we found in our March 2003 report on performance management,  candid and constructive feedback helps individuals maximize their  contribution and potential for realizing the goals and objectives of an  organization. At the Department of Education (Education), one case  study agency from our 2015 report on employee engagement, the Office  of the Chief Information Officer (OCIO) implemented a process to help  ensure that constructive performance conversations regularly occur. In  addition to department-wide requirements for supervisors to hold two  performance conversations a year, OCIO officials said that they require  all supervisors to offer OCIO employees optional quarterly conversations.  These quarterly performance conversations are guided by a set of  specific topics that supervisors and employees developed together to  ensure that employees receive consistent and regular constructive  feedback and coaching.
Career development and training. Our analysis found that career  development and training was the second strongest driver government- wide. For the question, “I am given a real opportunity to improve my skills  in my organization,” we found that, controlling for other factors, someone  who answered “strongly agree” to that question would have on average  an engagement score that was approximately 15 percentage points  higher than someone who answered “strongly disagree.”
As we found in 2004, the essential aim of training and development  programs is to assist an agency in achieving its mission and goals by  improving individual and, ultimately, organizational performance. At the  National Credit Union Administration (NCUA), another case study agency  from our 2015 report on employee engagement, officials said the agency  focused on providing training for employees throughout their careers. For  example, NCUA requires each employee to develop an individual  development plan. For employees new to credit union examining—a  majority of employees—NCUA has a standardized 18-month training  program that combines classroom and practical work. New examiners  must complete a core set of courses and may also choose additional  elective courses. NCUA officials said that they are constantly assessing  formal and informal training for entry-level employees to identify areas to  improve the curriculum and instruction. For more experienced examiners,  NCUA provides continuing training and development, according to these  officials.
Remaining drivers. For the remaining 4 drivers, we found that  government-wide, controlling for other factors, someone who answered  “strongly agree” to those questions would have on average an  engagement score that was between 10 and 14 percentage points higher  than someone who answered “strongly disagree.” Those four drivers are  work-life balance (“My supervisor supports my need to balance work and  other life issues”), inclusive work environment (“Supervisors work well  with employees of different backgrounds”), employee involvement (“How  satisfied are you with your involvement in decisions that affect your  work”), and communication from management (“How satisfied are you  with the information you receive from management on what’s going on in  your organization”). Examples of how the three case study agencies from  our 2015 report implemented practices consistent with these drivers  include the following:
Work-life balance. Federal Trade Commission (FTC) officials  implemented an outreach strategy to inform staff about child and elder  care resources after learning that employees were not aware of the  services or did not know that they qualified for these services. Officials  said employee knowledge of and agency commitment to these kinds  of programs enhances supervisor support for work-life balance.  Similarly, to support work-life balance, as part of its engagED  initiative, Education revised telework policies, provided training for  managers and employees on the new polices and on working in a  telework environment, and improved infrastructure to make telework  as effective as time spent in the office, according to Education  officials.
Inclusive work environment. The FTC established an agency-wide  Diversity Council to develop comprehensive strategies to promote  understanding and opportunity throughout FTC. FTC officials said that  employees of all levels were interested in forming such a council. This  included employees who experienced diversity issues firsthand as  well as managers who could address those issues. The goal of FTC’s  Diversity Council—composed of representatives from each bureau  and office—is to engage employees and supervisors across the  agency, make recommendations for improving diversity, and foster  the professional development of all agency employees, according to  these officials.
Employee involvement. Education’s Office of General Counsel  (OGC) has a permanent employee-driven Workforce Improvement  Team (WIT) that grew out of an office-wide meeting with employees at  all levels to involve employees in the discussions about the FEVS  results. As a result of this group’s work, Education’s OGC  management introduced additional training and professional  development opportunities and improved employee on-boarding  through a new handbook and mentoring program. Education’s OGC  officials said that the staff-driven WIT has created feelings of stronger  ownership, engagement, and influence in office decision making.  Education’s OGC officials said that OGC’s management seeks  feedback from staff, including from the WIT, to evaluate the  effectiveness of improvement efforts. These officials said that this  strengthens two-way communication, which improves employee  engagement and organizational performance.
Communication from management. NCUA officials told us that the  head of the agency and its senior leaders communicate with line  employees (who are mostly in the field) through quarterly webinar  meetings. The meetings are scheduled to accommodate the field  employees’ frequent travel schedule and generally start with any “hot  topics” and continue with discussion of agency efforts to meet mission  goals. The agency head takes questions in advance and during the  webinar and, when needed, participants research and share  responses with agency employees. According to NCUA officials,  these regular, substantive conversations demonstrate top leadership’s  commitment and respect for all employees as valued business  partners.
These key drivers can help agencies develop a culture of engagement as  agencies embed them into the fabric of everyday management practices,  rather than simply reacting to the results of the most recent FEVS.  Importantly, these six practices were generally the consistent drivers of  higher EEI levels when we analyzed them government-wide and by age  groups, and were the same drivers of engagement identified in our prior  analysis of the 2014 EEI. Because these six practices are the strongest  drivers of the EEI, this suggests they could be the starting points for all  agencies seeking to improve engagement.
section_title: Lessons Learned for Improving Employee Engagement
paragraphs: In our 2015 report we identified three key lessons for improving employee  engagement, each of which is described in greater detail below.
subsections: section_title: Use Effective Management Practices to Build a Culture of Engagement
paragraphs: Our three case study agencies in our 2015 report on employee  engagement attributed their high or increasing levels of engagement to  overall effective management practices more so than to efforts  specifically aimed at improving engagement levels. Officials at these  agencies said they pay attention to employee engagement scores, but  also focus on overall positive organizational health and culture and on  how their agency implements change efforts. Some of the practices  agencies cited parallel those we identified in 2003 as key to successful  organizational transformation, including top leadership involvement,  consistency, creating a line of sight linking individual  results to  organizational performance, and employee outreach.
Top leadership involvement. Officials from all three of our case study  agencies said that top agency leaders were directly involved in  organizational improvement efforts. We have previously reported top  leadership that is clearly and personally leading the change presents  stability and provides an identifiable source for employees to rally around  and helps the process/efforts stay the course. For example, Education  officials said Education’s Chief Information Officer is directly involved in  efforts to address FEVS scores—including being directly involved in the  data analysis, reviewing Education’s Office of the Chief Information  Officer (OCIO) action plans developed by each of his subordinate  directors, overseeing implementation of strategies, and assessing their  effectiveness.
Consistency. Officials at Education’s OCIO said it is important to ensure  that policies are applied consistently, which is the goal of that office’s  Speaking with One Voice initiative. The biweekly management meetings  to discuss and clarify the implementation of department policies (e.g.,  telework, resources, and employee bonuses) were instituted after  conversations with employees revealed that policies were inconsistently  applied. As a result of the initiative, Education’s OCIO officials said  employees know that senior leaders are paying attention to how policies  affect employees and are accountable for ensuring appropriate  implementation.
Line of sight. FTC officials emphasized the importance of creating a line  of sight between the agency’s mission and the work of each employee.  As we have previously reported, successful organizations create a “line of  sight” showing how team, unit, and individual performance can contribute  to overall organizational results. FTC officials said that the agency lists  every employee that contributed to a case in the pleadings, from the  attorneys and paralegals to the information technology specialists who  provided computer support. Importantly, FTC officials said they recognize  how mission support functions, such as excellent human resources  customer service contribute to the agency mission.
Employee outreach. According to officials at all three case study  agencies, they all reach out to employees and their labor union  representatives, if applicable, to obtain insight into their FEVS scores or  to inform other improvement efforts. Our 2003 report found that employee  involvement strengthens the improvement process by including frontline  perspectives and experiences. By participating in improvement task  teams, employees have additional opportunities to share their  experiences and shape policies and procedures as they are being  developed and implemented. For example, in 2012, while NCUA’s EEI  score was above the government-wide level, FEVS questions about  awards, performance appraisals, and merit-based promotions were its  lowest scoring categories. NCUA officials said they contracted with an  external facilitator to conduct workshops and webinar-based feedback  sessions with employees to gain insight into their FEVS results and  identify root causes influencing the survey scores. These officials said  that using external facilitators offered employees confidentiality and  created an environment that encouraged open conversations. Based on  these feedback sessions, NCUA created an internal employee-driven  committee to inform revisions to the awards, performance appraisals, and  merit-based promotion process, and developed recommendations for  NCUA’s management to implement these changes. Most of the  committee’s recommendations were implemented.
section_title: Supplemental Data Sources Enable Agencies to Pinpoint Efforts
paragraphs: According to officials at our case study agencies in our 2015 report on  employee engagement, while the EEI provides a useful barometer for  engagement, other indicators can provide officials with further insight into  reasons for engagement levels and areas for improvement. Other data  such as turnover rates and equal employment opportunity (EEO)  complaints—which are likely already collected by federal agencies—can  provide additional insight and strategies for improving employee  engagement. Notably, MSPB found that there is a statistically significant  correlation between higher levels of employee engagement and fewer  EEO complaints. Officials in the three case study agencies said that  they pay attention to their FEVS scores, but other sources of data can  provide explanatory or agency-specific information valuable to developing  improvement strategies.
section_title: Effects of Engagement Efforts Occur Over Multiple Years
paragraphs: Officials at case study agencies for our 2015 report on employee  engagement told us that they take a multi-year, multi-prong approach to  improving engagement and do not base engagement efforts solely on the  survey cycle or focus their attention on year to year changes in the EEI.  Some case study agency officials said a single survey cycle does not  provide enough time to implement changes and see results because real  change usually takes more than 1 year. The FEVS cycle begins around  May and agencies receive results in September or October. It may be  late-winter or early-spring before an agency will have designed an action  plan. By the time the next survey cycle begins, agencies may still be  interpreting results and developing and implementing their action plans.
Moreover, according to case study agency and other officials we  interviewed for the 2015 report, the annual survey cycle does not allow  enough time for employees’ perceptions to change before the next cycle  begins. For example, an Education official said that it took a few years  to see the effects of engagement-related actions. Members of the Chief  Human Capital Officers Council and National Council on Federal Labor- Management Relations joint working group on employee engagement  said that the effects of initiatives implemented to improve engagement,  will not be reflected in the EEI scores for at least a couple of years, which  makes evaluating their effectiveness challenging.
Instead of focusing exclusively on FEVS and EEI scores, the case study  agencies we examined took a longer term approach to their engagement  efforts. For example, according to officials, Education established  engagED, a long-term cultural change initiative aimed at building a more  innovative, collaborative and results-oriented agency, and creating a  more engaged workforce. Key components included quarterly all-staff  meetings with the Secretary to discuss various topics; a “lunches with  leaders” program that allowed agency employees to discuss key topics  with senior agency leaders; and periodic leadership summits where  agency leaders participate in developmental activities identified by staff  and focused on teams, individual leadership, and problem resolution.
In conclusion, more than simply a goal in its own right, higher levels of  engagement can enhance an agency’s “brand” to job seekers, reduce  turnover, and most importantly, improve organizational performance.  Moreover, while our analysis and the experience of our case study  agencies suggests that developing a culture of engagement does not  necessarily require expensive programs or technology, it does  necessitate effective management strategies such as leadership  involvement, strong interpersonal skills on the part of supervisors, and  thoughtful use of data. The starting point is valuing employees, focusing  on their performance and career development, and ensuring their  inclusion in decisions affecting their work. These engagement efforts,  combined with other components of a robust talent management strategy  covering the full life-cycle of federal employment, provide an ample tool  kit that should position agencies to be competitive in the labor market for  top talent.
This completes my prepared remarks. I would be happy to answer any  questions the Subcommittee may have.
section_title: GAO Contact and Acknowledgments
paragraphs: For further information regarding this statement, please contact Robert  Goldenkoff, Director, Strategic Issues, at (202) 512-2757, or  goldenkoffr@gao.gov.
Individuals making key contributions to this statement include Chelsa  Gurkin, Assistant Director; Shelby Kain, Analyst-in-Charge; Giny Cheong,  Sara Daleski, John F. Hussey III,  Donna Miller, Anna Maria Ortiz, Ulyana  Panchishin, and LaSonya Roberts.
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