The Wall Street Journal is reporting [gated] that Treasury's Troubled Asset Relief Program is being hampered by a lack of staff. Given what Treasury's civil service (i.e., non-political appointee) jobs have to offer potential job seekers, this should surprise no one.
First, consider what type of skills are necessary to help run the TARP. It is not dissimilar from a $700B hedge fund, and it requires similar skills: reading financial statements, creating models, and business judgment. In short, TARP requires the sort of skills obtained on Wall Street and at MBA programs. Treasury competes directly with these alternatives for the best talent, and a Treasury civil service career does not compare well, particularly on salary.
Business Week's top ten MBA programs all claim average starting salary above $100,000, with three programs exceeding the $120K mark, and this is just salary: most jobs include bonuses. A search of Treasury job postings yields five positions that could pay eventually pay $100K, and none where the starting pay exceeds $100K. The pay also tops out lower ($149K, lower than the total compensation of a starting management consultant at Bain, BCG, or McKinsey). This problem is not limited to Treasury; closing the salary differential between judges and private sector alternatives is frequently advocated.
There are other issues as well. Civil service career progression ends when the org chart switches from civil service to political appointee positions. The positions are not breeding grounds for lucrative private sector careers in the future. And, unlike Federal judges, the positions are not regarded as highly prestigious. Finally, the government bureaucracy has a reputation as slow to move, less focused on merit, and discouraging for the entrepreneurial types found in business schools. While the civil service has its benefits - work-life balance, job stability, and, importantly, pride in serving one's country - these benefits do not have top MBAs or Wall Street alumni rushing to Washington.
How to to fix this dilemma? There are examples of government bureaucracies that work. Japan's METI (f/k/a MITI) regularly recruits the nation's top graduates due METI's important role, exclusive hiring practices, and the resulting private sector opportunities. If Treasury's TARP promised similar long-term opportunities, it would have more success in recruiting the needed staff. But more important than that? Show them the money.
Friday, November 28, 2008
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1 comment:
Totally agree, although i would argue that the US is actually better off here than a lot of other countries. I know that in Belgium no one (and i mean no one) with any sense would ever go for a job in government. Here you at least get some competent people (e.g. Madam Nguyen :-))
But good point nonetheless
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