Policy

Pentagon Reports Sharp Drop in Use of Contractors

DoD credits streamlining for sharp dip

The Pentagon is using fewer services contractors than at any time since such data has been collected, according to a new and previously unpublicized Defense Department report to Congress obtained by CQ Roll Call.

The number of services contractors dropped 13 percent from fiscal 2014 to fiscal 2015, the most recent reporting period, the document shows.

The Pentagon says the sharp dip is due to streamlining its affairs and to revised ways of counting contractors’ work. But advocates for both government employees and contractors — two camps that disagree with each other on a lot — share skepticism that the reported decline in contractors is correct. Indeed, federal auditors have regularly questioned the accuracy of the Pentagon’s reckoning of contractors.

Even if the official estimates of Defense contractors are not completely accurate, at least they are close, critics say. But if a provision in the Senate’s defense authorization bill that narrows the reported information were to become law, the figures would be so underestimated as to be useless, critics say.

Pentagon outsourcing and privatization, which surged after 9/11, has been a hot-button political issue, because thousands of jobs and billions of dollars are affected. The question of whether contractors or federal workers are more cost-effective remains in dispute. The new report could further roil the debate.

Congress insisted eight years ago on an accounting of the Pentagon’s use of private companies to provide services, after department leaders could not tell lawmakers how many contractors were being hired.

The new Pentagon report on its “inventory of contracted services,” dated Sept. 20, reflects the department’s latest count of the number of “full time equivalent” employees it would take to perform the work being done by services contractors.

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The number of such contractors in the Defense Department in fiscal 2015 was just over 561,000, compared to 641,000 the year before, according to the new report.

The services contractor count includes workers performing functions ranging from lawn-mowing to systems analysis, from computer support to logistics, and from medical services to engineering. It does not include private-sector personnel working on classified contracts. Nor does it count weapons manufacturing contractors.

By comparison to the 561,000 service contractors in fiscal 2015, the number of such contractors has hovered at higher levels — between 623,000 and 767,000 — since fiscal 2008, the first year for which Congress required the reports.

The Pentagon’s private-sector workforce, while reduced, is still an army — in fact, even the lower amount of service contractors is greater than the 475,000 active-duty soldiers currently serving in the actual Army.

The Defense Department has 35 percent more civilians than service contractors. The civilian workforce in fiscal 2015 was 757,000, the department says.

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