C O R P O R A T I O N GINGER GROEBER, KIRSTEN M. KELLER, PHILIP ARMOUR, SAMANTHA E. DINICOLA, IRINA A. CHINDEA, BRANDON CROSBY, ELLEN E. TUNSTALL, SHREYAS BHARADWAJ Department of the Air Force Civilian Compensation and Benefits How Five Mission Critical and Hard-to-Fill Occupations Compare to the Private Sector and Key Federal Agencies For more information on this publication, visit www.rand.org/t/RRA334-1 Library of Congress Cataloging-in-Publication Data is available for this publication. ISBN: 978-1-9774-0639-2 Published by the RAND Corporation, Santa Monica, Calif. © Copyright 2021 RAND Corporation R® is a registered trademark. Cover: Air traffic controller: Getty Images/Stocktrek Images. Limited Print and Electronic Distribution Rights This document and trademark(s) contained herein are protected by law. This representation of RAND intellectual property is provided for noncommercial use only. Unauthorized posting of this publication online is prohibited. 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Support RAND Make a tax-deductible charitable contribution at www.rand.org/giving/contribute www.rand.org Preface This report provides an overview of civilian compensation and benefits in the federal government and identifies the constraints the U.S. Air Force must operate under in comparison with alternative compensation and benefit structures found in federal agencies and the private sector for critical skills or hard-to-fill occupations. The report focuses on five occupational series identified by the Air Force as mission critical or hard to fill: Aircraft Operations (GS-2181), Air Traffic Control (GS-2152), Human Resources Management (GS-0201), Information Technology Management (Cyber) (GS-2210), and Aircraft Mechanic (WG-8852). For each occupational series, the report provides an overview of current Air Force compensation and how that compares with compensation in other federal agencies and the private sector, as well as highlighting key compensation-related recruiting and retention issues. The report then concludes by providing recommendations on actions the Air Force can take to improve the competitiveness of its compensation and benefits packages in order to better recruit and retain top-tier civilian talent. This report is intended primarily for policymakers responsible for civilian force management and compensation within the Air Force. The findings and recommendations may also be of interest to other military services, the U.S. Department of Defense (DoD), and the U.S. Office of Personnel Management. This research was sponsored by the Air Force Directorate of Civilian Force Management (AF/A1C) and was conducted within the Manpower, Personnel, and Training Program of RAND Project AIR FORCE as part of a fiscal year 2019 project, “Civilian Compensation and Benefits.” RAND Project AIR FORCE RAND Project AIR FORCE (PAF), a division of the RAND Corporation, is the Department of the Air Force’s (DAF’s) federally funded research and development center for studies and analyses, supporting both the United States Air Force and the United States Space Force. PAF provides DAF with independent analyses of policy alternatives affecting the development, employment, combat readiness, and support of current and future air, space, and cyber forces. Research is conducted in four programs: Strategy and Doctrine; Force Modernization and Employment; Manpower, Personnel, and Training; and Resource Management. The research reported here was prepared under contract FA7014-16-D-1000. Additional information about PAF is available on our website: www.rand.org/paf/ This report documents work originally shared with DAF on September 30, 2019. The draft report, issued on October 9, 2019, was reviewed by formal peer reviewers and DAF subject- matter experts. iii Contents Preface ............................................................................................................................................ iii Figures........................................................................................................................................... vii Tables ............................................................................................................................................. ix Summary ........................................................................................................................................ xi Acknowledgments ........................................................................................................................ xiii Abbreviations ............................................................................................................................... xiv 1. Introduction ................................................................................................................................. 1 Study Objective and Approach ................................................................................................... 3 The Structure of This Report ...................................................................................................... 5 2. Civilian Compensation in the Federal Government .................................................................... 6 Compensation in the Federal Government ................................................................................. 6 Comparing Federal Salaries and Wages with Those of the Private Sector .............................. 15 Conclusions ............................................................................................................................... 17 3. A Comparison of Civilian Benefits: The Federal Government and the Private Sector ............ 19 Health Insurance ....................................................................................................................... 20 Life Insurance ........................................................................................................................... 21 Retirement ................................................................................................................................. 22 Leave ......................................................................................................................................... 23 Disability Insurance .................................................................................................................. 28 Workers’ Compensation ........................................................................................................... 29 Long-Term Care ....................................................................................................................... 29 Flexible Spending Accounts ..................................................................................................... 30 Child and Dependent Care ........................................................................................................ 30 The Employee Assistance Program .......................................................................................... 31 Student Loan Repayment and Education Expense Support ...................................................... 31 Alternative Work Methods and Schedules ............................................................................... 32 Conclusions ............................................................................................................................... 33 4. Air Force Mission Critical Occupations ................................................................................... 34 Defining Mission Critical Occupations .................................................................................... 34 Determining Mission Critical Occupations .............................................................................. 35 The Implications of Declaring an Occupation as Mission Critical ........................................... 40 Conclusions ............................................................................................................................... 43 5. Aircraft Operations: Pilots and Simulator Instructors .............................................................. 45 An Overview of the Occupation ............................................................................................... 45 Aircraft Operations Compensation ........................................................................................... 47 iv A Comparison of Air Force Compensation with That of Other Federal Agencies and the Private Sector ...................................................................................................................... 51 The Air Force Cost of Matching Private-Sector or Other Government Agency Pay ............... 58 Additional Recruiting and Retention Issues Related to Compensation .................................... 58 Options for Developing More Competitive Compensation