    [Analytical Perspectives]
    [Dimensions of the Budget]
    [24. Federal Employment and Compensation]
    [From the U.S. Government Printing Office, www.gpo.gov]

    [[Page 351]]

                    24.  FEDERAL EMPLOYMENT AND COMPENSATION

      This section provides information on civilian and military employment
    in the Executive, Legislative, and Judicial branches. It also provides
    information on personnel compensation and benefits and on overseas
    staffing presence.

                          Measuring Federal Employment

      For budgetary purposes, civilian employment is measured on the basis
    of full-time equivalents (FTEs). One FTE is equal to one work year (see
    OMB Circular A-11, Section 32). Put simply, one full-time employee
    counts as one FTE, and two half-time employees also count as one FTE.

                   Significant Changes in Civilian Employment

      Table 24-1 shows Executive Branch civilian FTE (excluding the U.S.
    Postal Service) growing by two percent between 2003 and 2007. The
    primary reason for this growth is related to homeland security and the
    global war on terrorism. Significant changes by agency are discussed
    below.
      The Department of Commerce requests additional FTE, the majority of
    which will allow the U.S. Patent and Trademark Office (PTO) to reduce a
    large backlog of patent applications. PTO fees fully fund the increase
    in FTE. The augmentation is also due to increased workload associated
    with the 2010 Census development and testing, including full
    implementation of the American Community Survey, by the Census Bureau.
      The Department of Energy is increasing its FTE as it continues to
    oversee the Nation's effort to improve energy supply and conservation.
    Increases are also due to weapons-related workload within the National
    Nuclear Security Administration.
      The Department of Health and Human Services is requesting additional
    FTE to support the implementation of the Medicare Prescription Drug,
    Improvement, and Modernization Act of 2003 (MMA) at the Centers for
    Medicare and Medicaid Services; conduct hearings and appeals as directed
    by the MMA, expand staff at the Indian Health Service health care
    facilities; increase scientific research positions at the National
    Institutes of Health; conduct pre-market review of new drugs, medical
    devices, animal drugs, and other products regulated at the Food and Drug
    Administration (FDA) and the FDA Office of Drug Safety; increase
    activities at the Office of the National Coordinator for Health
    Information Technology; implement pandemic influenza preparedness and
    biodefense activities; increase Inspector General's work on fraud and
    abuse in a number of HHS programs, including Medicaid; and add Program
    Support Center staff to handle increased Service and Supply Fund
    business.
      The total FTE for the Department of Homeland Security continues to
    stabilize. New increases are driven by additional personnel for
    immigration, customs, and border protection.
      Department of Justice FTE are increasing due to enhancements in law
    enforcement and homeland security-related programs. This growth largely
    occurs in the Federal Bureau of Investigation, Federal Prison System,
    Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the U.S.
    Marshals.
      The majority of the FTE increase for the Department of Veterans
    Affairs is related to VA Medical Care in order to provide timely,
    accessible, and high quality care to our Nation's veterans. The
    remaining increase is primarily to ensure timely and accurate benefits
    processing.
      The Office of Personnel Management gains FTE as it completes the
    transfer of security investigative personnel from the Department of
    Defense to OPM.
      The Social Security Administration is projecting a decrease in FTE as
    the agency completes its increased workload related to processing
    applications for prescription drugs under the Medicare Prescription Drug
    Improvement and Modernization Act of 2003.

                   Significant Changes in Military Employment

      As seen in Table 24-3, the Department of Defense's request reduces
    active duty personnel. The bulk of these positions are being eliminated
    in the Navy and Air Force as part of those Services' streamlining and
    rightsizing efforts. The remaining personnel were extra strength on
    active duty due to Global War on Terror requirements.

                       Personnel Compensation and Benefits

      Table 24-4 displays personnel compensation and benefits (in millions
    of dollars) for Federal civilian and military personnel of all branches
    of Government.
      Direct compensation of the Federal civilian work force includes base
    pay and premium pay, such as overtime. In addition, it includes other
    cash components, such as geographic and other pay differentials (e.g.,
    locality pay, and special pay adjustments for law enforcement officers),
    recruitment and relocation bonuses, retention allowances, performance
    awards, and cost-of-living and overseas allowances. Military personnel
    compensation also includes special and incentive pays (e.g., enlistment
    and reenlistment bonuses), and allowances for clothing, housing, and
    subsistence.
      Personnel benefits for current employees consists of the cost to
    Government agencies for health insurance, life insurance, Social
    Security (old age, survivors, disability, and health insurance)
    contributions to the retirement funds to finance future retirement
    benefits,

    [[Page 352]]

    and other items. Compensation for former personnel includes outlays for
    retirement pay benefits and the Government's share of the cost of health
    and life insurance.

                       The U.S. Overseas Staffing Presence

      There are approximately 67,000 permanent American and locally hired
    staff overseas under the authority of Chiefs of Mission (e.g.,
    Ambassadors or Charge d' Affairs at U.S. embassies worldwide). The
    average cost of an American position overseas in 2007 is projected to be
    about $491,000. This total includes direct costs, such a salary and
    overseas allowances, and support costs, such as housing, educational
    costs for dependents, travel, administrative support and Capital
    Security Cost Sharing charges.
      The Administration is working to improve the safety, efficiency, and
    accountability in U.S. Government staffing overseas through the
    Presidential Management Agenda (PMA) initiative on a Right-sized
    Overseas Presence. Rightsizing is ensuring that the composition of
    Government agencies and staffing overseas is consistent with our foreign
    policy goals, security concerns, and overall fiscal constraints.
      A key component of this initiative is developing transparent data on
    overseas staffing, including the cost of maintaining positions overseas,
    and incorporating this data in the budget process to better inform
    decision makers on overseas staffing levels. With our foreign policy
    priorities necessitating increased support to meet new requirements in
    the Global War on Terror, the fight against global AIDS, and support for
    emerging democracies, it is important that we be able to deploy our
    overseas staff resources effectively.
      Periodic reviews are another tool to encourage effective deployment of
    staff overseas. For example, when a new embassy construction project is
    under development, formal staffing rightsizing reviews are now required.
    For the new embassy construction projects included in the President 2007
    budget, these review resulted in an eight percent reduction in projected
    staffing needs. These reviews focus on linking staffing to mission
    goals, eliminating unnecessary duplication, and encouraging shared
    services and outsourcing. The Department of State plans to review
    staffing at each existing U.S. mission once every five years.

                                Overseas Staffing Under Chief of Mission (COM) Authority*
    ----------------------------------------------------------------------------------------------------------------
      Total Personnel Overseas
        Under COM  Authority       Total American Personnel     Average Cost of  a U.S.      New Overseas American
      (Including American  and        Overseas Under COM         Direct  Hire Overseas     Positions Funded  in the
      Locally  Engaged  Staff)     Authority Projected  for       Estimated for 2007       President's  2007 Budget
        Projected  for 2006                  2006
    ----------------------------------------------------------------------------------------------------------------
                    66,854                       14,526                     $491,000                         303
    ----------------------------------------------------------------------------------------------------------------
    * As reported by agencies in their 2007 budget submissions

      Another element of the rightsizing plan is to consolidate functions,
    which are not location specific, in regional centers or back to the
    United States. In 2005, The Department of State opened a new regional
    center in Frankfurt, Germany that will be used to provide consolidated
    support services to Europe and parts of Africa and Near East Asia. The
    Department's new Office of Global Support Services and Innovation is
    implementing a plan that will systematically regionalize or centralize
    all non-location specific support services over the next three years,
    beginning with high-threat danger posts in 2006, to be completed through
    2008.
      The Administration will continue to build on these Rightsizing
    initiatives through expanded shared-services and regionalization/
    centralization, rigorous post level reviews, and an accurate accounting
    of overseas staffing and costs to strengthen mechanisms to ensure
    safety, efficiency, and accountability in our U.S. Government personnel
    presence overseas.

    [[Page 353]]

                            Table 24-1.  FEDERAL CIVILIAN EMPLOYMENT IN THE EXECUTIVE BRANCH
                        (Civilian employment as measured by Full-Time Equivalents, in thousands)
    ----------------------------------------------------------------------------------------------------------------
                                                        Actual                  Estimate        Change: 2003 to 2007
                     Agency                 ------------------------------------------------------------------------
                                               2003      2004      2005      2006      2007       FTE's     Percent
    ----------------------------------------------------------------------------------------------------------------
    Cabinet agencies:
      Agriculture..........................     101.4     100.5      99.6     100.1      99.1        -2.3      -2.3%
      Commerce.............................      34.5      34.6      35.1      37.4      38.2         3.7      10.7%
      Defense-military functions...........     648.9     650.4     653.0     666.7     663.6        14.7       2.3%
      Education............................       4.5       4.4       4.3       4.3       4.3        -0.2      -3.4%
      Energy...............................      15.6      15.1      14.9      15.7      15.9         0.3       1.8%
      Health and Human Services............      60.0      59.3      59.3      61.3      62.0         2.0       3.3%
      Homeland Security....................     144.5     137.3     143.3     146.6     150.3         5.8       4.0%
      Housing and Urban Development........      10.4      10.2       9.9       9.8       9.4        -1.0      -9.1%
      Interior.............................      71.0      70.7      70.4      70.2      69.8        -1.2      -1.7%
      Justice..............................      99.4     101.4     103.0     118.5     117.6        18.2      18.3%
      Labor................................      16.9      16.5      16.0      16.8      16.9  ..........  .........
      State................................      29.5      30.0      30.1      30.3      30.5         1.0       3.3%
      Transportation.......................      59.0      57.3      55.5      55.4      55.9        -3.1      -5.3%
      Treasury.............................     115.4     113.6     110.0     112.5     110.3        -5.1      -4.5%
      Veterans Affairs.....................     211.8     218.7     222.0     222.8     223.3        11.5       5.4%

    Other agenciesexcluding Postal Service:
      Agency for International Development.       2.3       2.2       2.4       2.5       2.7         0.4      17.2%
      Broadcasting Board of Governors......       2.4       2.3       2.2       2.3       2.2        -0.2      -8.5%
      Corps of EngineersCivil Works........      24.5      23.5      22.5      22.9      22.5        -2.0      -8.2%
      Environmental Protection Agency......      17.5      17.3      17.5      17.4      17.6         0.1       0.4%
      Equal Employment Opportunity Comm....       2.6       2.5       2.4       2.4       2.4        -0.2      -8.4%
      Federal Deposit Insurance Corporation       5.4       5.3       4.9       4.2       4.1        -1.3     -24.6%
      General Services Administration......      12.9      12.6      12.5      12.2      12.0        -0.9      -7.0%
      National Aeronautics and Space Admin.      18.7      18.8      18.8      18.6      18.2        -0.5      -2.7%
      National Archives and Records               2.8       2.8       2.8       2.9       2.9         0.1       3.6%
       Administration......................
      National Labor Relations Board.......       1.9       1.9       1.8       1.8       1.8        -0.1      -4.5%
      National Science Foundation..........       1.2       1.3       1.3       1.4       1.4         0.2      15.5%
      Nuclear Regulatory Commission........       2.9       3.0       3.1       3.3       3.3         0.4      14.1%
      Office of Personnel Management.......       2.8       2.8       3.6       4.5       4.5         1.7      61.9%
      Peace Corps..........................       1.0       1.1       1.0       1.1       1.1         0.1      14.8%
      Railroad Retirement Board............       1.1       1.1       1.0       1.0       0.9        -0.2     -13.8%
      Securities and Exchange Commission...       3.1       3.6       3.9       3.8       3.7         0.6      18.9%
      Small Business Administration........       3.8       3.4       4.1       5.2       3.0        -0.8     -21.7%
      Smithsonian Institution..............       5.2       5.1       5.1       5.6       5.6         0.4       8.3%
      Social Security Administration.......      63.1      63.9      64.6      64.0      62.0        -1.1      -1.7%
      Tennessee Valley Authority...........      13.1      12.0      12.6      12.7      12.5        -0.6      -4.5%
      All other small agencies.............      15.1      14.9      14.8      15.7      16.1         1.0       6.4%
                                            ------------------------------------------------------------------------
    Total, Executive Branch civilian          1,826.2   1,821.1   1,829.6   1,874.2   1,867.7        41.5       2.3%
     employment *..........................

    Subtotal, Defense......................     648.9     650.4     653.0     666.7     663.6        14.7       2.3%

    Subtotal, Non-Defense..................   1,177.3   1,170.7   1,176.6   1,207.5   1,204.0        26.7       2.3%
    ----------------------------------------------------------------------------------------------------------------
    * Totals may not add due to rounding.

    [[Page 354]]

                                          Table 24-2.  TOTAL FEDERAL EMPLOYMENT
                                         (As measured by total positions filled)
    ----------------------------------------------------------------------------------------------------------------
                                                                Actual as of September 30       Change: 2003 to 2005
                         Description                      ----------------------------------------------------------
                                                              2003        2004        2005      Positions   Percent
    ----------------------------------------------------------------------------------------------------------------
    Executive branch civilian employment:
      All agencies except Postal Service and Postal Rate
       Commission:
        Full-time permanent..............................   1,646,688   1,662,990   1,663,043      16,355       1.0%
        Other than full-time permanent...................     220,288     218,953     209,157     -11,131      -5.1%
                                                          ----------------------------------------------------------
          Subtotal.......................................   1,866,976   1,881,943   1,872,200       5,224       0.3%
                                                          ==========================================================
    Postal Service: \1\
      Full-time permanent................................     634,709     609,579     605,120     -29,589      -4.7%
      Other than full-time permanent.....................     164,539     158,083     159,090      -5,449      -3.3%
                                                          ----------------------------------------------------------
        Subtotal.........................................     799,248     767,662     764,210     -35,038      -4.4%
                                                          ----------------------------------------------------------
      Subtotal, Executive branch civilian employment.....   2,666,224   2,649,605   2,636,410     -29,814      -1.1%
                                                          ==========================================================
    Military personnel on active duty: \2\
      Department of Defense..............................   1,434,377   1,426,836   1,389,394     -44,983      -3.1%
      Department of Homeland Security (USCG).............      37,472      40,230      40,710       3,238       8.6%
      Commissioned Corps (HHS, EPA, NOAA)................       6,200       6,357       6,363         163       2.6%
                                                          ----------------------------------------------------------
        Subtotal, military personnel.....................   1,478,049   1,473,423   1,436,467     -41,582      -2.8%
                                                          ----------------------------------------------------------
          Subtotal, Executive Branch.....................   4,144,273   4,123,028   4,072,877     -71,396      -1.7%
                                                          ==========================================================
    Legislative branch:
      Full-time permanent................................      12,044      11,614      11,389        -655      -5.4%
      Other than full-time permanent.....................      19,070      18,435      19,427         357       1.9%
                                                          ----------------------------------------------------------
        Subtotal, Legislative Branch.....................      31,114      30,049      30,816        -298      -1.0%
                                                          ==========================================================
    Judicial Branch:
      Full-time permanent................................      30,955      30,537      30,765        -190      -0.6%
      Other than full-time permanent.....................       3,304       3,324       3,299          -5      -0.2%
                                                          ----------------------------------------------------------
        Subtotal, Judicial Branch........................      34,259      33,861      34,064        -195      -0.6%
                                                          ==========================================================
    Grand total \3\......................................   4,209,646   4,186,938   4,137,757     -71,889      -1.7%
                                                          ==========================================================
                           ADDENDUM

    Executive branch civilian personnel (excluding Postal
     Service):
      DOD civilians--Military functions..................     636,454     644,251     648,590      12,136       1.9%
      All other executive branch.........................   1,230,522   1,237,692   1,223,610      -6,912      -0.6%
                                                          ----------------------------------------------------------
        Total............................................   1,866,976   1,881,943   1,872,200       5,224       0.3%
    ----------------------------------------------------------------------------------------------------------------
    \1\ Includes Postal Rate Commission.
    \2\ Excludes reserve components.
    \3\ Includes Summer Aides, Stay-in-school, Junior Fellowship, Worker-Trainee Opportunity, and disadvantage youth
      programs.

    [[Page 355]]

                                          Table 24-3.  TOTAL FEDERAL EMPLOYMENT
                                         (As measured by Full-Time Equivalents)
    ----------------------------------------------------------------------------------------------------------------
                                                                               Estimate         Change: 2005 to 2007
                         Description                            2005    --------------------------------------------
                                                               Actual       2006       2007      FTE's      Percent
    ----------------------------------------------------------------------------------------------------------------

    Executive branch civilian personnel:
      All agencies except Postal Service and Defense.......   1,176,630  1,207,502  1,204,005     27,375        2.3%
      Defense-Military functions (civilians)...............     652,987    666,663    663,649     10,662        1.6%
                                                            --------------------------------------------------------
        Subtotal, excluding Postal Service.................   1,829,617  1,874,165  1,867,654     38,037        2.1%
      Postal Service \1\...................................     744,196    732,348    717,000    -27,196       -3.7%
                                                            --------------------------------------------------------
        Subtotal, Executive Branch civilian personnel......   2,573,813  2,606,513  2,584,654     10,841        0.4%
                                                            ========================================================
    Executive branch uniformed personnel: \2\
      Department of Defense................................   1,408,115  1,375,647  1,347,100    -61,015       -4.3%
      Department of Homeland Security (USCG)...............      40,710     41,139     41,528        818        2.0%
      Commissioned Corps (HHS, EPA, NOAA)..................       6,363      6,404      6,420         57        0.9%
                                                            --------------------------------------------------------
        Subtotal, uniformed military personnel.............   1,455,188  1,423,190  1,395,048    -60,140       -4.1%
                                                            --------------------------------------------------------
        Subtotal, Executive Branch.........................   4,029,001  4,029,703  3,979,702    -49,299       -1.2%
                                                            ========================================================
    Legislative Branch: 3 Total FTE \3\....................      31,831     32,681     33,004      1,173        3.7%
    Judicial branch: Total FTE.............................      32,912     33,681     34,086      1,174        3.6%
                                                            ========================================================
        Grand total........................................   4,093,744  4,096,065  4,046,792    -46,952       -1.1%
    ----------------------------------------------------------------------------------------------------------------
    \1\ Includes Postal Rate Commission.
    \2\ Military personnel on active duty. Excludes reserve components. Data shown for military are average
      strengths, not FTEs.
    \3\ FTE data not available for the Senate (positions filled were used).

    [[Page 356]]

                                    TABLE 24-4.  PERSONNEL COMPENSATION AND BENEFITS
                                                (In millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                                                Change: 2005 to 2007
                          Description                           2005        2006       2007   ----------------------
                                                               Actual     Estimate   Request     Dollars    Percent
    ----------------------------------------------------------------------------------------------------------------

    Civilian personnel costs:
      Executive Branch (excluding Postal Service):
        Direct compensation:
          DODmilitary functions............................      40,899     42,013     42,587       1,688       4.1%
          All other executive branch.......................      83,960     88,859     91,337       7,377       8.8%
                                                            --------------------------------------------------------
            Subtotal, direct compensation..................     124,859    130,872    133,924       9,065       7.3%
        Personnel benefits:
          DODmilitary functions............................      10,619     11,151     11,477         858       8.1%
          All other executive branch.......................      34,315     35,904     36,885       2,570       7.5%
                                                            --------------------------------------------------------
            Subtotal, personnel benefits...................      44,934     47,055     48,362       3,428       7.6%
                                                            --------------------------------------------------------
              Subtotal, executive branch...................     169,793    177,927    182,286      12,493       7.4%
                                                            ========================================================
      Postal Service:
        Direct compensation................................      39,300     40,195     40,953       1,653       4.2%
        Personnel benefits.................................      13,084     15,020     15,263       2,179      16.7%
                                                            --------------------------------------------------------
          Subtotal.........................................      52,384     55,215     56,216       3,832       7.3%
                                                            --------------------------------------------------------
      Legislative Branch: \1\
        Direct compensation................................       1,803      1,871      1,968         165       9.2%
        Personnel benefits.................................         482        532        560          78      16.2%
                                                            --------------------------------------------------------
          Subtotal.........................................       2,285      2,403      2,528         243      10.6%
                                                            ========================================================
      Judicial Branch:
        Direct compensation................................       2,556      2,731      2,917         361      14.1%
        Personnel benefits.................................         736        799        849         113      15.4%
                                                            --------------------------------------------------------
          Subtotal.........................................       3,292      3,530      3,766         474      14.4%
                                                            --------------------------------------------------------
          Total, civilian personnel costs..................     227,754    239,075    244,796      17,042       7.5%
                                                            ========================================================
    Military personnel costs:
      DODMilitary Functions:
        Direct compensation................................      79,445     74,162     71,421      -8,024     -10.1%
        Personnel benefits.................................      38,329     37,055     37,174      -1,155      -3.0%
                                                            --------------------------------------------------------
          Subtotal.........................................     117,774    111,217    108,595      -9,179      -7.8%
                                                            ========================================================
    All other executive branch, uniformed personnel:
      Direct compensation..................................       2,407      2,612      2,636         229       9.5%
      Personnel benefits...................................         653        724        753         100      15.3%
                                                            --------------------------------------------------------
        Subtotal...........................................       3,060      3,336      3,389         329      10.8%
                                                            --------------------------------------------------------
      Total, military personnel costs \2\..................     120,834    114,553    111,984      -8,850      -7.3%
                                                            ========================================================
    Grand total, personnel costs...........................     348,588    353,628    356,780       8,192       2.4%
                                                            ========================================================
                            ADDENDUM
    Former Civilian Personnel:
      Retired pay for former personnel.....................      56,073     59,579     62,516       6,443      11.5%
        Government payment for Annuitants:
          Employee health benefits.........................       7,889      8,204      8,765         876      11.1%
          Employee life insurance..........................          38         39         39           1       2.6%

    Former Military personnel:
      Retired pay for former personnel.....................      39,166     41,396     43,582       4,416      11.3%
      Military annuitants health benefits..................       6,399      7,097      7,541       1,142      17.8%
    ----------------------------------------------------------------------------------------------------------------
    \1\ Excludes members and officers of the Senate.
    \2\ Excludes reserve components not on active duty.