NCPA - National Center for Policy Analysis

Some 850,000 Government Jobs May Be Farmed Out To Private Contractors

November 15, 2002

The Bush administration intends to place about 850,000 federal jobs -- nearly half the civilian work force -- up for competition from private contractors in order to save taxpayers' dollars.

The goal is to create "a market-based government unafraid of competition, innovation and choice."

  • The new policy -- which can be put into effect without congressional approval -- represents a major expansion of a trend in government at all levels over the past two decades.
  • State and local governments, as well as Washington, have been hiring private companies to pick up trash, run prisons, collect traffic tickets and do much of the other mundane business of government.
  • In the past, about half the jobs put out for competition end up going to private contractors -- with 60 percent of those going to small businesses and companies owned by women or minorities.
  • Administration officials have variously estimated the savings to the government at 20 percent to 30 percent.
  • The Bush administration has already been pressing government agencies to award 15 percent of jobs not "inherently governmental" through competition between civil service employees and the private sector.

Federal employees would have an opportunity to bid against private competitors to fulfill their function at the lowest cost. Local and state governments have found that in many cases public employees come up with better ways to keep doing their jobs at a lower cost to taxpayers.

Source: Richard W. Stevenson, "Government Plan May Make Private Up to 850,000 Jobs," New York Times, November 15, 2002.


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