More federal executives are less satisfied with their pay

Senior executives across the federal government are significantly less satisfied currently with their pay than they were two years ago, according to survey results released Tuesday by the Office of Personnel Management.

The survey, which sought to gauge Senior Executive Service opinions on pay for performance and executive development, found that 61 percent of SESers were satisfied or very satisfied with their pay, a significant decrease from the 73 percent positive response from SES members in the 2006 federal human capital survey.

Nancy Kichak, associate director of strategic human resources policy at OPM, said SES pay satisfaction was the lowest it has been since the 2002 human capital survey, when executives weighed in with a 60 percent satisfaction rate. But she added that the creation of a pay-for-performance system within the SES in 2004 raised the top-level pay cap to $172,200, giving executives access to a higher rate of pay than was available in 2002.

"Now folks have been in that system for four years," she said. "If they've been receiving more than the annual increase, they're [again] approaching the max they can get. … We believe the cap is starting to influence these results."

Kichak said there could be other reasons for the decrease in pay satisfaction, though OPM was not aware yet of what those could be. She said OPM would examine the results and determine other factors that could be contributing to the decline.

Carol Bonosaro, president of the Senior Executives Association, wrote in a Tuesday e-mail that she was not surprised by the decrease in pay satisfaction. "Congress and the next administration must consider resolution of this issue a high priority if the large numbers of career executives expected to retire over the next several years are to be replaced with high-quality executives," she said.

The survey was e-mailed to 6,745 career, noncareer and term appointment SES members between Jan. 17 and Feb. 8, 2008. A total of 4,386 responded to the survey for a response rate of 65 percent.

Kichak said OPM was particularly disappointed by the responses to certain questions related to the extent of pay-for-performance communications and training for executives. When a 2006 Senior Executives Association survey reflected a lack of understanding of the pay-for-performance process among executives, she said, OPM pushed agencies to brief and inform executives on the results of the process.

Reponses from executives ranged from a low of 35 percent, of those who received a summary of overall results, to a high of 63 percent, of those who received a briefing or training on the performance management system, according to the survey.

"We happen to know some agencies, such as OPM, where we held a session with folks and talked to them about the system, and yet we didn't get 100 percent," Kichak said. "We know the agencies do these activities, and for some reason, the communication of the results obviously didn't stand out in the minds of executives."

Meanwhile, the survey confirmed OPM's projections of high turnover in the senior ranks in the near future. Of the career SES respondents, 39 percent indicated they planned to leave or retire in the next three years, and 60 percent planned to do so in the next five years.

On pay for performance, 93 percent of SES respondents believed their pay should be based on performance, while 89 percent reported they participated in the development of their performance plan. Of the respondents, 68 percent said their appraisal was a fair reflection of their job performance.

OPM expressed concern with SES responses on executive development, noting that 35 percent of respondents indicated that their development needs were not assessed. In addition, 37 percent said during their SES tenure they had not engaged in any of the activities commonly used for developing executives, including 360-degree assessments, mentoring, coaching or sabbaticals.

Kichak said OPM would work with the Chief Human Capital Officers Council to share best practices and help agencies improve processes surrounding performance management and communication.

"The CHCOs are very engaged in this," she said. "We gave them a heads up on their individual [agency] results, and they are extremely motivated to look at what those results tell them and get out there among their executives and work with them to improve their results."