Strategic Human Capital Management
Since we last reported on government-wide efforts to address skills gaps, the Office of Personnel Management (OPM), the Chief Human Capital Officers (CHCO) Council,1 and individual agencies have strengthened their leadership over this area; however, OPM and agencies have only partially met the criteria for removal from the High-Risk List. Mission-critical skills gaps within the federal workforce pose a high risk to the nation. Regardless of whether the shortfalls are in such government-wide occupations as cybersecurity and acquisitions, or in agency-specific occupations such as nurses at the Veterans Health Administration (VHA), skills gaps impede the federal government from cost-effectively serving the public and achieving results. Agencies can have skills gaps for different reasons: they may have an insufficient number of people or their people may not have the appropriate skills or abilities to accomplish mission-critical work. Moreover, current budget and long-term fiscal pressures, the changing nature of federal work, and a potential wave of employee retirements that could produce gaps in leadership and institutional knowledge, threaten to aggravate the problems created by existing skills gaps. Indeed, the government’s capacity to address complex challenges such as disaster response, national and homeland security, and rapidly-evolving technology and privacy security issues requires a skilled federal workforce able to work seamlessly with other agencies, with other levels of government, and across sectors.
We first added strategic human capital management to the High-Risk List in 2001.2 In our 2015 update, we noted that while OPM and agencies had made strides in developing an infrastructure for identifying and addressing skills gaps, they needed to do additional work to more fully use workforce analytics to identify their gaps, implement specific strategies to address these gaps, and evaluate the results of actions taken so as to demonstrate progress in closing the gaps.3 Mission critical skills gaps were also a factor in making other areas across government high risk. Of the 34 other high-risk areas covered in this report, 15 areas—such as IT management, acquisitions, and management of oil and gas resources—had skills gaps playing a contributory role.4
 The CHCO Council is an interagency body composed of the Director of OPM, the Deputy Director for Management at the Office of Management and Budget (OMB), CHCOs from Executive departments, and other members designated by the Director. The CHCO Council, among other things, advises OPM, OMB, and agency leaders on human capital strategies and policies as well as assesses federal workforce characteristics and future needs.
 GAO, High-Risk Series: An Update, GAO-01-263 (Washington, D.C.: Jan. 1, 2001).
 GAO, High-Risk Series: An Update, GAO-15-290 (Washington, D.C.: Feb. 11, 2015).
 The complete list of sections in this report that feature skills gap findings includes: Management of Federal Oil and Gas Resources; Managing Federal Real Property; Improving the Management of IT Acquisitions and Operations; Department of Defense (DOD) Business Systems Modernization; DOD Financial Management; Strengthening Department of Homeland Security (DHS) Management Functions; Ensuring the Security of Federal Information Systems and Cyber-Critical Information and Protecting the Privacy of Personally Identifiable Information; Protecting Public Health through Enhanced Oversight of Medical Products; Transforming the Environmental Protection Agency’s (EPA) Processes for Assessing and Controlling Toxic Chemicals; DOD Contract Management; Department of Energy (DOE)’s Contract Management for the National Nuclear Security Administration and Office of Environmental Management; National Aeronautics and Space Administration (NASA) Acquisition Management; Enforcement of Tax Laws; Managing Risks and Improving Department of Veterans Affairs (VA) Health Care; and Improving Federal Management of Indian Programs.
Since we last reported on government-wide efforts to address skills gaps, OPM, the CHCO Council, and individual agencies have strengthened their leadership over this area, including establishing a new human capital framework to guide their efforts. In doing so, they have (1) taken important steps to institutionalize efforts to close skills gaps and (2) enhanced the analytical method used to identify skills gaps. However, OPM and agencies have only partially met the criteria for removal from the High-Risk List for developing the capacity to close skills gaps, designing and implementing action plan strategies for closing skills gaps, and monitoring efforts to close existing skills gaps as well as identify emerging ones. Additionally, OPM and agencies have not yet demonstrated sustainable progress in closing skills gaps.
To date, Congress has provided agencies with authorities and flexibilities to manage the federal workforce and make the federal government a more accountable employer. For example, Congress included a provision in the National Defense Authorization Act for Fiscal Year 2016 to extend the probationary period for newly hired civilian Department of Defense (DOD) employees from 1 year to 2 years.1 As we noted in our 2015 report, better use of probationary periods gives agencies the ability to ensure an employee’s skills are a good fit for all critical areas of a particular job. Dismissing employees who cannot do the work becomes more difficult and time consuming after the probationary period because of the procedural requirements agencies must follow and the greater appeal rights afforded.2
Further, oversight hearings held by the House and Senate focusing on federal human capital management challenges have been important for ensuring that OPM and agencies continue to make progress in acquiring, developing, and retaining employees with the skills needed to carry out the government’s vital work.
 GAO, Federal Workforce: Improved Supervision and Better Use of Probationary Periods Are Needed to Address Substandard Employee Performance, GAO-15-191 (Washington, D.C.: Feb. 6, 2015).
OPM and agencies can continue taking actions to address skills gaps with respect to capacity, action plan, monitoring, and demonstrated progress. In particular, we have identified several priority recommendations to OPM, in its role as leader for human capital management in the federal government:
- OPM needs to strengthen the approach and methodology for addressing skills gaps by working with agencies to develop targets that are clear, measurable, and outcome-oriented.
- OPM needs to establish a schedule specifying when it will modify its EHRI database to collect staffing data, in concert with agency CHCOs, and needs to help bolster agencies’ ability to assess workforce competencies, either by sharing competency surveys, disseminating lessons learned, or by other means.
- OPM, in consultation with the CHCO Council, should develop a core set of human capital metrics that agencies can use to monitor progress in closing skills gaps through HRstat reviews, and OPM should ensure that these efforts are coordinated with other agency skills gap initiatives.
Individual agencies must also take steps to address skills gaps identified in our prior work. For example, we recommended that the Department of Veterans Affairs (VA) institute a system-wide evaluation of the initiatives to recruit and retain VHA nurses.1 Doing so could provide VHA with better data to identify resource needs across its medical centers and ensure that its nursing workforce is keeping pace with the health care needs of veterans. VA agreed with our recommendation and indicated in August 2016 that it had formed a working group that is charged with reporting on observations from data on recruitment and retention effectiveness by October 2017.
Continued congressional attention to improving the government’s human capital policies and procedures will be essential going forward. For example, in our August 2016 report, to help improve the federal hiring process, we recommended that OPM assess the effectiveness of government hiring authorities to determine whether opportunities exist to refine, consolidate, eliminate, or expand them.2 In cases where legislation would be necessary to implement changes, we recommended that OPM should work with the CHCO Council to develop legislative proposals. OPM concurred with this recommendation and said it would work with the CHCO Council and others to develop proposals as appropriate.
 GAO, VA Health Care: Oversight Improvements Needed for Nurse Recruitment and Retention Initiatives, GAO-15-794 (Washington, D.C.: Sept. 30, 2015).
 GAO, Federal Hiring: OPM Needs to Improve Management and Oversight of Hiring Authorities, GAO-16-521 (Washington, D.C.: Aug. 2, 2016).
GAO-17-30: Published: Dec 23, 2016. Publicly Released: Jan 23, 2017.
The Veterans Health Administration's (VHA) limited human resources (HR) capacity combined with weak internal control practices has undermined VHA's HR operations and its ability to improve delivery of health care services to veterans.Attrition of medical center HR staff increased between fiscal years 2013 and 2015, due to HR staff transferring to other federal agencies. VHA officials note a lack o...
GAO-17-143: Published: Dec 16, 2016. Publicly Released: Jan 17, 2017.
The Food and Drug Administration (FDA), an agency within the Department of Health and Human Services (HHS), has increased its foreign drug inspections and enhanced its ability to prioritize drug establishments for inspection. The number of foreign inspections has consistently increased each year since fiscal year 2009. Beginning in fiscal year 2015, FDA conducted more foreign than domestic inspect...
GAO-17-8: Published: Nov 30, 2016. Publicly Released: Nov 30, 2016.
Integrated program teams (IPT) are cross-functional or multidisciplinary groups of individuals that are organized and collectively responsible for delivering a product to an external or internal customer. GAO identified three characteristics that contribute to the creation and operation of a comprehensive IPT: (1) executive leadership through team support, empowerment, and oversight; (2) team comp...
GAO-16-742: Published: Sep 29, 2016. Publicly Released: Oct 31, 2016.
The Department of the Interior has taken steps to resolve its hiring and retention challenges for key staff engaged in oil and gas activities, but it has not evaluated the effectiveness of its efforts and has missed opportunities to collaborate within the department for resolving these challenges. Specifically, Interior has taken steps to address two underlying factors—lower salaries and a lengt...
GAO-16-704: Published: Sep 7, 2016. Publicly Released: Sep 7, 2016.
The Transportation Security Administration (TSA) uses a variety of programs to train and evaluate Transportation Security Officers (TSO) who are responsible for screening passengers and baggage for threats to aviation security. For example, by law, TSOs must complete 40 hours of classroom training, 60 hours of on-the-job training, and certification tests before performing screening. Once certified...
GAO-16-521: Published: Aug 2, 2016. Publicly Released: Sep 1, 2016.
A hiring authority is the law, executive order, or regulation that allows an agency to hire a person into the federal civil service. Of the 105 hiring authorities used in fiscal year 2014, agencies relied on 20 for 91 percent of the 196,226 new appointments made that year. Office of Personnel Management (OPM) officials said they do not know if agencies rely on a small number of authorities because...
GAO-16-306: Published: Apr 5, 2016. Publicly Released: May 5, 2016.
The Federal Emergency Management Agency (FEMA) faces the following challenges in ensuring that its information technology (IT) programs adequately support the agency's ability to respond to major disasters:Governance and oversight: FEMA established an investment review board to select and oversee IT investments, as called for by leading practices. But the board has not fully defined roles and resp...
GAO-16-80: Published: Dec 14, 2015. Publicly Released: Dec 14, 2015.
The Department of Defense (DOD) has increased the size of its acquisition workforce from about 126,000 in September 2008 to about 153,000 in March 2015. The growth was accomplished by hiring additional civilian personnel, insourcing work previously performed by contractors, adding more military personnel, and re-categorizing existing positions. However, 6 of the 13 acquisition career fields, inclu...
GAO-15-794: Published: Sep 30, 2015. Publicly Released: Oct 30, 2015.
The Department of Veterans Affairs' (VA) Veterans Health Administration (VHA) has multiple system-wide initiatives to recruit and retain its nurse workforce, but three of the four VA medical centers in GAO's review faced challenges offering them. VHA identified a number of key initiatives it offers to help medical centers recruit and retain nurses, which focus primarily on providing (1) education...
GAO-15-347: Published: Sep 22, 2015. Publicly Released: Oct 28, 2015.
GAO has a related report that discusses SBA’s organizational structure with a focus on its regional offices. See Small Business Administration: Views on the Operational Effects of Closing Regional Offices, GAO-15-369 (Washington, D.C.: Sept. 22, 2015).What GAO FoundThe Small Business Administration (SBA) has not resolved many of its long-standing management challenges due to a lack of sustained...
GAO-15-191: Published: Feb 6, 2015. Publicly Released: Mar 9, 2015.
Federal agencies have three avenues to address employees' poor performance:Day-to-day performance management activities (such as providing regular performance feedback to employees) can produce more desirable outcomes for agencies and employees than dismissal options. However, supervisors do not always have effective skills, such as the ability to identify, communicate, and help address employee p...
GAO-15-223: Published: Jan 30, 2015. Publicly Released: Jan 30, 2015.
Lessons learned from initial efforts to try to close skills gaps could strengthen future approaches. For example, the Chief Human Capital Officer (CHCO) Council Working Group (Working Group) identified skills gaps in six government-wide occupations, such as cybersecurity and auditors. Although this effort was an important step forward, GAO's work has identified skills gaps in nearly two dozen occu...