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<classification authority="sudocs">GA 1.13:GGD-94-95</classification>
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 <subject>Contract costs</subject>
 <subject>Cost effectiveness analysis</subject>
 <subject>Federal procurement policies</subject>
 <subject>Procurement regulation</subject>
 <subject>Cost control</subject>
 <subject>Proposed procurement</subject>
 <subject>Procurement evaluation</subject>
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<titleInfo>
 <title>Government Contractors: Measuring Costs of Service Contractors Versus Federal Employees</title>
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<abstract>The federal government spent nearly $12 billion in fiscal year 1992 on
advisory and service contracts. An analysis of studies done by GAO, the
Energy Department, and the Defense Department suggests that cost
comparisons can be useful in deciding how to acquire needed services in
the most cost effective way. Federal agencies are not now required to do
such cost comparisons in deciding whether to contract for advisory and
assistance services. Although the nine studies GAO reviewed indicate
that it may be less expensive in some cases if services were done by
federal workers rather than by contractors, all of the studies had
limitations. The studies also varied in the extent to which they
incorporated all possible cost factors. In addition to cost, GAO
believes that agencies should consider other factors in deciding whether
to contract out for advisory services, including quality, timeliness,
the technical skills of federal employees, and the duration of the work
to be done. GAO notes that a potential conflict exists between the
administration&apos;s objectives of (1) giving federal managers the
flexibility to obtain needed services from the best possible source and
(2) downsizing the federal workforce.</abstract>
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 <topic>Contract costs</topic>
 <topic>Cost effectiveness analysis</topic>
 <topic>Federal procurement policies</topic>
 <topic>Procurement regulation</topic>
 <topic>Cost control</topic>
 <topic>Proposed procurement</topic>
 <topic>Procurement evaluation</topic>
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 <topic>Competitive procurement</topic>
 <topic>Service contracts</topic>
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