Federal Contractors losing jobs

[Anonymous]

I'm hearing many federal contractors are being told their positions are being eliminated in 30 days (e.g. State Dept, NASA) if 60% of their functions can be performed by an employee. (These are day-to-day workers, not consultants). Is it really more cost effective to have employees? Are employees taking on extra duties?

[Anonymous]

Are these third party consultants? Consulting firms?

[Anonymous]

America is sucking balls.

[Anonymous]

Anonymous wrote:Are these third party consultants? Consulting firms?

No- not like a booz allen who is on a set timeframe contract. These are companies that have on site contractors in IT, Comms, Finance- some of which have been there for a decade.

[Anonymous]

1 contractor I know at State was laid off a month or two ago.

Yes, typically direct hire employees are cheaper in total cost than contractors, but they are getting rid of those too.

[Anonymous]

Anonymous wrote:1 contractor I know at State was laid off a month or two ago.

Yes, typically direct hire employees are cheaper in total cost than contractors, but they are getting rid of those too.

How is that possible with benefits, retirement, etc.?

[Anonymous]

Didn’t 2000 NASA staff just up and quit? Who’s gonna do these contractor jobs? Same with state department, saw a crap ton lost their jobs this week.

[Anonymous]

That’s really nice they get 30 days. When contracts are cut you usually get terminated same day.

[Anonymous]

Anonymous wrote:

Anonymous wrote:1 contractor I know at State was laid off a month or two ago.

Yes, typically direct hire employees are cheaper in total cost than contractors, but they are getting rid of those too.

How is that possible with benefits, retirement, etc.?

The salary is very high. I was offered basically a secretary job for 112k a few years ago, but couldn't swing the hours.

[Anonymous]

Anonymous wrote:

Anonymous wrote:1 contractor I know at State was laid off a month or two ago.

Yes, typically direct hire employees are cheaper in total cost than contractors, but they are getting rid of those too.

How is that possible with benefits, retirement, etc.?

Typical body shop contractor markup is maybe 80-100%. This means if contractor's direct employee has $x in pre-tax salary then government is charged (1.8 * x) to (2 * x) dollars.

The pass-thru markup typically is 8% to 10%. So for subcontractors who are 1099s (on the same contract) who get paid $x, the government gets charged (1.08 * x) to (1.1 * x) dollars.

Federal employees usually cost less than a direct employee of the contractor. For subcontractors who are 1099s, the subcontractors often are cheaper than civil service, but not always.

My part of the government is not in the budget. We are pure fee for service, so I have visibility into the fully burdened costs of a civil service employee.

[Anonymous]

Anonymous wrote:

Anonymous wrote:1 contractor I know at State was laid off a month or two ago.

Yes, typically direct hire employees are cheaper in total cost than contractors, but they are getting rid of those too.

How is that possible with benefits, retirement, etc.?

Who do you think pays for the benefits, retirement, etc. of the contractor employees? They all have health insurance and 401(k) matching too. Their employer builds it into the rate they charge the government. Plus the employer takes their cut for being the middleman.
That's why direct hire is always cheaper for FTE. (If we're talking projects or seasonal, then it's less certain to be cheaper.)

But if you already don't have enough direct-hire govies - which you don't, because you had contractors instead - then you definitely don't have enough people to do all the jobs once the contractors are gone. And government isn't hiring. So tasks have to be dropped.

[Anonymous]

I am working as a contractor at a Federal agency (FINREG), and my employer is hiring A LOT of IT people. I was hired three months ago and the salary is 220K/yr.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:1 contractor I know at State was laid off a month or two ago.

Yes, typically direct hire employees are cheaper in total cost than contractors, but they are getting rid of those too.

How is that possible with benefits, retirement, etc.?

Typical body shop contractor markup is maybe 80-100%. This means if contractor's direct employee has $x in pre-tax salary then government is charged (1.8 * x) to (2 * x) dollars.

The pass-thru markup typically is 8% to 10%. So for subcontractors who are 1099s (on the same contract) who get paid $x, the government gets charged (1.08 * x) to (1.1 * x) dollars.

Federal employees usually cost less than a direct employee of the contractor. For subcontractors who are 1099s, the subcontractors often are cheaper than civil service, but not always.

My part of the government is not in the budget. We are pure fee for service, so I have visibility into the fully burdened costs of a civil service employee.

Imagine if the federal government had the same system of appending a percentage of the total salaries and benefits of support staff and management to each FTE's hourly rate to get the true cost of a federal employee.

[Anonymous]

As a fed it’s always more cost effective to hire federal employees. Contractors are expensive and I don’t think they’re always treated well. The reason I see contractors hired is because federal hiring is so convoluted and we can’t pay enough.

[Anonymous]

Anonymous wrote:I am working as a contractor at a Federal agency (FINREG), and my employer is hiring A LOT of IT people. I was hired three months ago and the salary is 220K/yr.

That is wild that you make as much as an SES head of a division.