Human Capital: Opportunities to Improve Executive Agencies' Hiring Processes
Published: 2003-05-30T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Improving the federal hiring process is critical, as the number of new hires is expected to increase substantially. Federal agencies are responsible for their hiring processes, but must generally comply with applicable Office of Personnel Management (OPM) rules and regulations. Congressional requesters asked GAO to identify federal hiring obstacles, provide examples of innovative hiring practices, and identify opportunities for improvement. To address these issues, GAO interviewed the human resources directors in 24 largest departments and agencies, analyzed the hiring practices of five federal executive branch agencies, and reviewed OPM's role in the hiring process.
section_title: What GAO Found
paragraphs: 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 have noted problems with the federal hiring process. Nearly all of the federal human resource directors from the 24 largest federal agencies told us that it takes too long to hire quality employees. According to data compiled by OPM, the estimated time to fill a competitive service position was typically more than 3 months, with some human resources directors citing examples of hiring delays exceeding 6 months. The competitive hiring process is hampered by inefficient or ineffective practices, including defining a vacant job and pay that is bound by narrow federal classification standards, unclear job announcements, the quality of certain applicant assessment tools, time-consuming panels to evaluate applicants, and the "rule of three" that limits selecting managers choice of candidates. Equally important, agencies need to develop their hiring systems using a strategic and results-oriented approach. GAO studied five agencies that human capital experts identified as having taken steps to improve parts of the hiring process--the U.S. Geological Survey, the Department of the Army, the U.S. Census Bureau, and the Department of Agriculture's Agricultural Research Service and Forest Service. Some of these 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 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.

section_title: Letter
paragraphs: 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.  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. 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).
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, the objectives of this report are to  identify major factors that hamper or delay 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).  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.)
subsections: section_title: Background
paragraphs: 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 “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.”  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.  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, 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.
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.  Table 2 shows total new hires by department in fiscal year  2002.
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.
section_title: Federal Hiring Is a Lengthy, Cumbersome Process
paragraphs: It is widely recognized both within government and the private sector that  the federal hiring process is lengthy and cumbersome and hampers  agencies’ ability to hire the people they need to achieve their agency goals  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  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.”
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.”
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.”
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.”
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.”
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.
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  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.
subsections: section_title: Process of Defining the Job and Determining Pay Is Complex and Antiquated
paragraphs: The process of defining a job and determining pay is complex and  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.  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.
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.
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.”  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 performance rather than position.  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.
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.
section_title: Job Vacancy Announcement Content Cited as Hampering the Hiring Process
paragraphs: Several HR directors we interviewed for this study cited the content of job  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.  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.  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.
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.
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   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.
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.
section_title: Key Assessment Tool and Related Hiring Programs Are Ineffective
paragraphs: Several HR directors and human capital experts have found problems with  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  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.  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.  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.  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. 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.
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.  Also, MSPB recommended that OPM develop new assessment  tools for the occupations covered under the Luevano Consent Decree.
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.
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.   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,  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.
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.
section_title: Manual Processes Are Time Consuming and Paperwork Intensive
paragraphs: A key problem noted by many HR directors is that much of the hiring  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  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.
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.
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.”  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.  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  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.
section_title: The Rule of Three Limits Managers’ Choice of Quality Candidates
paragraphs: One of the largest obstacles to the federal hiring process mentioned in our  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.  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.  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.   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.
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.   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.
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  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.
section_title: OPM’s Role and Performance in the Federal Hiring Process
paragraphs: 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  governmentwide hiring challenges.  OPM’s current strategic plan includes a  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  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.
section_title: Conclusions
paragraphs: 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  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.
section_title: Recommendations for Executive Action
paragraphs: OPM’s hiring initiatives are moving in the direction that will help agencies  improve their hiring processes.   OPM can assist agencies by helping the  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;   review the effectiveness of the Outstanding Scholar and  Bilingual/Bicultural Luevano Consent Decree hiring authorities.
section_title: Agency Comments and Our Evaluation
paragraphs: OPM and DOD provided written comments on a draft of this report.   Technical comments were provided orally by USGS and via email by  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  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.
Director, Strategic Issues The Honorable Joseph I. Lieberman  Ranking Minority Member  Committee on Governmental Affairs  The Honorable Daniel K. Akaka  Ranking Minority Member  Subcommittee on Financial Management, the     Budget and International Security   Committee on Governmental Affairs  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  The Honorable Danny K. Davis  Ranking Minority Member  Subcommittee on Civil Service     and Agency Organization  Committee on Government Reform  The Honorable Dave Weldon, M.D.
section_title: Federal Hiring Using the Competitive Service or the Excepted Service
paragraphs: 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).  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.
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.  The rule of three  requires managers to select from among the top three numerically ranked  candidates available for appointment.  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  veteran is sustained by the Office Of Personnel Management (OPM).   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.  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.
section_title: Description of Category Rating Project Carried Out by the Agricultural Research Service and the Forest Service
paragraphs: 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).  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.
section_title: Objectives, Scope, and Methodology
paragraphs: 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.
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.  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.
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.
section_title: Comments from the Office of Personnel Management
paragraphs: The following are GAO’s comments on the Office of Personnel  Management’s (OPM) letter dated May 6, 2003.
subsections: section_title: GAO Comments
paragraphs: 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  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.
section_title: Comments from the Department of Defense
paragraphs: The following are GAO’s comments on the Department of Defense’s (DOD)  letter dated April 14, 2003.
subsections: section_title: GAO Comments
paragraphs: 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. 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  Interagency Chief Human Capital Officer Council, which could replace  the Human Resources Management Council.
section_title: GAO Contacts and Staff Acknowledgments
subsections: section_title: GAO Contacts
section_title: Acknowledgments
paragraphs: 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.
section_title: GAO’s Mission
paragraphs: The General Accounting Office, the audit, evaluation and investigative arm of  Congress, exists to support Congress in meeting its constitutional responsibilities  and to help improve the performance and accountability of the federal government  for the American people. GAO examines the use of public funds; evaluates federal  programs and policies; and provides analyses, recommendations, and other  assistance to help Congress make informed oversight, policy, and funding  decisions. GAO’s commitment to good government is reflected in its core values of  accountability, integrity, and reliability.
section_title: Obtaining Copies of GAO Reports and Testimony
paragraphs: The fastest and easiest way to obtain copies of GAO documents at no cost is  through the Internet. GAO’s Web site (www.gao.gov) contains abstracts and full- text files of current reports and testimony and an expanding archive of older  products. The Web site features a search engine to help you locate documents  using key words and phrases. You can print these documents in their entirety,  including charts and other graphics.
Each day, GAO issues a list of newly released reports, testimony, and  correspondence. GAO posts this list, known as “Today’s Reports,” on its Web site  daily. The list contains links to the full-text document files. To have GAO e-mail this  list to you every afternoon, go to www.gao.gov and select “Subscribe to GAO  Mailing Lists” under “Order GAO Products” heading.
subsections: section_title: Order by Mail or Phone
section_title: To Report Fraud, Waste, and Abuse in Federal Programs
section_title: Public Affairs