Hundreds of thousands of government workers are about to retire, and we're nowhere near ready to replace them. Can Obama's agenda survive if no one's around to implement it?

As pundits exult over the latest Obama administration appointments--Hillary Clinton! Robert Gates! Bill Richardson!--short shrift has been given to a much larger group of federal employees who will play a critical role in the new presidency. Political appointees come and go, but the 1.8 million civil servants who spend their careers in the federal government are forever--at least until recently. Almost half that workforce could leave government by 2012, leaving the new administration scrambling to keep basic services running, much less implementing major new initiatives.

Obama’s election represents a new generation in the White House, but he’ll take office to find a far larger generational transition happening under his feet. By the end of his first term in office, the Office of Personnel Management, the independent agency that oversees the federal workforce, estimates 707,750 federal workers, many of them Baby Boomers, will be eligible to retire. The Partnership for Public Service, a leading government management non-profit, estimates that 530,000 of those employees, many of them in high-level positions, actually will leave government. In 2016, fully a million civil will eligible to retire. Between 2002 and 2006, the number of federal employees retiring annually rose from 30,300 a year to 45,000 a year: that rate could rise to 106,000 people annually.

Many of the people who will walk out the door work in so-called mission critical occupations, the jobs that are essential to the functioning of their agencies. The Partnership estimates that 36 percent of the Senior Executive Service, the highest-level career civil servants who oversee major government initiatives, will retire by 2012. So will 27 percent of employee supervisors and 20 percent of civilian workers at the Defense Department.

These retirements might not be a problem if there was a new generation of federal managers and executives ready to move into the vacancies that are about to open up. But there aren’t. In the early 1990’s, President Clinton froze hiring at some agencies and cut staffing at others, effectively gutting the federal government’s farm team. Today, to replace the employees who are departing, the federal government has to attract Generation Xers who are ready to manage and to lead. But they’ll be competing with the private sector for a limited resource. There are only 49.1 million Gen-Xers to replace the 76.7 million Baby Boomers who are retiring. The average federal salary was 23 percent lower than the average comparable private-sector salary in 2007, and federal agencies take longer than private companies to hire new employees.

Of course, for Obama’s agenda to get off the ground, a functioning civil service is imperative. Take the bailout: “Even if you charge [civil servants] only with housekeeping, there still has to be enough of them to handle it,” Paul Light, the Paulette Goddard Professor of Public Service at New York University, told National Journal in October. “One thousand people would be a reasonable total number, but it could run to 1,500.” The Treasury Department can’t just shift a thousand employees to staff the bailout. The department is already overstretched in some areas--the Internal Revenue Service, for example, is using private tax collectors to supplement its workforce. And yet, Treasury doesn’t have specific job listings for the bailout up on the government’s official employment website, two months after the Emergency Economic Stabilization Act became law. At the moment, the department is collecting résumés, but it’s not clear what--if any--jobs the department is considering applicants for. As of November 21, the Office of Financial Stability told the Government Accountability Office that it had 48 employees working on the bailout, only five of whom were new, full-time hires.

Another major Obama priority, health care reform, will require major federal hiring. It’s not yet clear what reform is likely to pass, but if the administration follows through on Obama’s campaign proposals to subsidize small employers who provide health care coverage, run a competitive health care market, mandate that employees have health insurance, or any combination thereof, it will have to hire a small army of new employees to oversee the new mechanisms created by reform. Comparable benefits agencies in the federal government like the Centers for Medicare and Medicaid, which employs 4,100 people, and the Social Security Administration, with 62,000 employees have their own dedicated and specialized workforces. A new health care agency would be no different. And if Obama wants to keep his promise to give his voters a government that delivers them the services they need, he has to pay attention the workers at agencies that are already up and running.

Air traffic controllers are another group of federal employees expected to be hit hardest by retirements, because many of them were hired together in a very short period of time after President Reagan fired their predecessors to quash a strike in 1981. Now, they are reaching retirement age en masse, which could leave the Federal Aviation Administration understaffed at a time when Americans are running out of patience with mounting flight delays. And as Baby Boomers across the country retire and become eligible for Social Security benefits, 24 percent of the Social Security Administration workers who will process their applications are due to retire too, at a time when hundreds of thousands of Americans are waiting for their disability claims to be processed by the agency.

In mid-September, just 26 percent of Americans said in a Gallup poll that they were satisfied with the way America was being governed, and 42 percent said they had a fair amount or a great deal of confidence in the executive branch of government. During the presidential election, Obama didn’t have to take responsibility for the services government was--or wasn’t--delivering. Now he does.

There are some promising signs. During the campaign, Obama fervently wooed federal employee unions, sending the largest, the American Federation of Government Employees, a series of letters in October promising to do everything from strengthening the Mine Safety and Health Administration to appointing labor law experts to the panels that adjudicate disputes between unions and agencies if he was elected. But it will take more than specific policy commitments to make the changes government will need to succeed. “I think one could argue without exaggeration that the success of [Obama’s] presidency will depend on his ability to inspire, lead, and in a thousand mundane ways each year, to manage, those two million employees,” Scott Cameron a director at management consulting firm Grant Thornton said at a December 3 event co-sponsored by his firm and the Partnership for Public Service.

For all the lofty rhetoric both candidates used to describe the honor of public service, the federal government is the largest company in the United States, and the president is its CEO. His employees--and his customers--are waiting to see what Obama does next.


Alyssa Rosenberg is a correspondent for Government Executive.

By Alyssa Rosenberg