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December 1, 2022

The SEC’s Attrition Rate is Up But Is It Worse Than Public Accounting’s?

a help wanted sign

Answer: nope.

POLITICO:

The SEC has seen attrition rates jump from 5.4 percent in fiscal year 2021 to an estimated 6.4 percent in 2022 — the highest in a decade, according to the report, which began circulating late last week. The SEC is not unique in seeing employees depart. Attrition rates across the federal government averaged 6.1 percent in fiscal year 2021, according to the Partnership for Public Service, which found that to be only “slightly higher than the previous year.”

But the departures still have managers across the SEC worried about the resulting reliance on detailees — temporary staffers from other parts of the government — who sometimes have “little or no experience in rulemaking,” the inspector general wrote. And some agency leaders are concerned that the faster timetables to propose and finalize rules outlined by Gensler are limiting the ability for staff to conduct research and analysis while increasing the risk the rules will be susceptible to court challenges.

The OIG’s memo [PDF] references four areas where the SEC faces management and performance challenges to varying degrees:

  • Meeting Regulatory Oversight Responsibilities
  • Protecting Systems and Data
  • Improving Contract Management
  • Ensuring Effective Human Capital Management

The Human Capital Management section begins on page 26 of the PDF and reads:

Despite OHR’s [Office of Human Resources] and OMWI’s [Office of Minority and Women Inclusion] efforts and the SEC being recognized as one of the best places to work in the federal government, the SEC seems to be facing challenges to its retention efforts. As the figures below demonstrate, the SEC has seen a significant increase in attrition over the last few years, from 3.8 percent in FY 2020 to an estimated 6.4 percent in FY 2022 (as of September 20, 2022) — the highest attrition rate in 10 years. Most concerning is the increased attrition in Senior Officer and attorney positions, expected to be about 20.8 percent and about 8.4 percent for FY 2022, respectively.

Some charts:

SEC attrition rate FY 2011 - FY 2022

SEC FY 2022 expected attrition by paygrade and position

It continues:

The SEC is not alone in facing a crisis to retain mission-critical talent during what has been dubbed “The Great Resignation.” Critical elements of the federal workforce are in a state of stress.

It then goes on to give some actual numbers on vacancies (about 289) and why the SEC may struggle to fill these positions:

Recruitment efforts are critical to ensuring a skilled and diverse candidate pool from which to fill SEC vacancies. In its FY 2023 Congressional Budget Justification the SEC requested a total of 5,261 positions, an increase of 454 positions from FY 2022 in which the SEC was authorized 4,807 positions. With FY 2022 attrition rates estimated to be at 6.4 percent — or about 289 positions — efforts to recruit and hire an additional 454 positions in FY 2023 could present challenges for OHR, OMWI, and SEC management. Moreover, the federal government is facing stiff competition from the private sector as increased wages and workforce engagement make private sector positions attractive to both new and seasoned professionals. The federal government hiring process has also been cited as a detriment when attracting talent to the federal government. For example, the federal government takes on average 98 days — more than twice as long as the private sector — to hire a new employee.

The SEC has issued a 2022-2024 recruiting plan “which identifies strategies to attract diverse talent and to aid in filling mission critical occupations that have been deemed hard-to-fill.” Among these, “branding and marketing that speaks to prospective applicants” (SEC TikToks when?), a multi-media recruitment and agency branding campaign that highlights successes of current SEC employees (so SEC LinkedIn Lunatics too?), developing a comprehensive internal communications strategy, and “creating an overarching recruitment, outreach, and engagement tool to enhance the recruitment process.” There’s not a single pizza party anywhere on that list??

If you haven’t gathered by now, the SEC plans to begin an intensive recruiting effort but it needs some help. The Inspector General found that the SEC’s pay-setting guidance needed improvement, specifically that pay-setting information available to SEC employees and hiring officials was not comprehensive, that internally published pay matrices were outdated, and that publicly advertised SEC salary information “was misleading for new hires.”

As for hybrid work, SEC “has not yet” mandated that its employees return to the office. On July 25, 2022 the agency announced that the planned return-to-office date was shifted from September 6, 2022 to January 9, 2023.

Best of luck to them!

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