Despite what many members of the public, and some political candidates, believe, getting a government job is not a guarantee of lifetime employment.
Federal and postal workers can and do get fired for many of the same reasons that private-sector folks are canned. And layoffs in government do happen, just not very often.
Over the past couple of years, it has been hard to find a single day when some company didn’t announce layoffs. Virtually every industry and segment of the economy has had to downsize because of financial losses. Fortunately for feds, most parts of the U.S. government — because they provide services or support — don’t have that kind of bottom line. Or make money.
Exceptions are the Treasury Department, which prints, distributes and then collects money. A few other government agencies charge fees to customers both inside and outside the federal establishment.
But even with its reputation as a fire-proof, “what-me-downsize?” outfit, Uncle Sam can and does let people go because of reduced budgets, reduced workload or a mission change.
The nonpostal federal work force is about 1.7 million people. During fiscal 2007, about 1,200 of them got pink slips — known in government as RIF (reduction in force) notices. Of that number, the vast majority were in Defense Department agencies, which booted — sometimes gently, sometimes not — almost 900 people out the door.
To ease the pain of a RIF, federal agencies can and do offer early retirement and buyouts. But not in large numbers. An early-out (when a worker qualifies for an immediate annuity and continuation of health insurance coverage) means anyone with 25 years of federal service or who is 50 or older with 20 years of service can leave. The early-outs, called VERAs (voluntary early retirement authority) are most popular when combined with a buyout.
Buyouts are a maximum payment of $25,000, which, after taxes and deductions, nets the VSIP (voluntary separation incentive payment) of $16,000 to $17,000. The VSIPs were initiated in the mid-1990s and aimed primarily at male veterans working in shipyards and Army depots.
Between 2003 and 2007, about 4,700 feds took early retirement (in many cases with a buyout), according to the Office of Personnel Management. The OPM keeps work force changes and trends records that would be the envy of any private company that cared about human capital (aka people).
Other fascinating tidbits from OPM’s regular family snapshots:
• One in every four feds would be eligible to leave if their agencies offered them the VERA option.
• The typical federal worker doesn’t retire when first eligible. According to the data, the average civil servant works for 3.1 years after attaining full retirement eligibility. That’s in part because federal workers get raises each year, most are eligible for a 5 percent government match to their 401(k) plan and federal retirement benefits are based on the average of the employee’s highest-three-year average salary. It is also true that when the economy is weak (and the job market poor) feds tend to delay retirement.
• Men stick around longer than women when they are first eligible to retire. The OPM says G-men remain an average of 3.3 years after they hit retirement eligibility. Women in government on average depart 2.7 years after retirement becomes an option.
• June and September may be favorite months for weddings. But when it comes time to retire, federal workers favor January, and then December. The least favorite month to retire is November.
The OPM found that in recent years, 60 percent of the retirees were male. That means 40 percent were women. That’s a change from just a few years ago (fiscal 2006) when 56 percent of the retirees were men and 44 percent were women.
Experts say there is probably a very good reason for the changing ratio. They just don’t know what it is.
• Mike Causey, senior editor at Federal News Radio AM 1050, can be reached at 202/895-5132 or mcausey@ federalnewsradio.com.
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