A General Accounting Office survey of Defense Department employes whose jobs were turned over to private contractors has found that, while most got new government jobs, some were unemployed and the majority of those who went to work for contractors did not earn as much as before.
The Reagan administration has encouraged agencies to turn over functions to the private sector when it can be shown that private firms can do the work for less money. But federal employe unions have expressed concern about the possible impact on jobs.
The GAO surveyed 2,535 DOD employes who were affected by decisions to contract out 31 functions. It found that 74 percent of them obtained other goverment jobs, 7 percent went to work for the contractors and 5 percent were laid off, or "involuntarily separated," in government parlance. Most of the rest resigned or retired.
Of the 94 people it surveyed who were laid off, the congressional watchdog agency found that 56 percent had received unemployment compensation or welfare, and 34 percent were unemployed at the time of the survey. Two-thirds had found new jobs, the majority of them with the federal government.
The GAO estimated that jobless and welfare benefits for the displaced workers totaled $215,000. That expense is not included when an agency makes cost comparisons, but the GAO doubted that it would have affected the DOD's decision when the savings estimated from contracting out amounted to more than $65 million.
Among the 130 people it surveyed who had gone to work for the winning contractor, 79 percent were doing the same type of work, 53 percent were earning less than they had from the government, and most were receiving lesser benefits. For instance, 87 percent said the government provided better retirement benefits, 81 percent used to have better sick leave and 76 percent had better vacation benefits.