Federal agencies are increasingly looking to recruit new talent to bolster an aging federal workforce and to fill critical skills gaps in areas such as technology.

But in contrast to the multitude of reforms to the agency hiring process in recent years, the federal pay system has remained untouched.

While nearly 30 percent of the federal workforce is under the age of 40, the infrequently updated General Schedule pay system is old enough to collect Social Security.

That’s a problem, according to Steve Condrey, chairman of the Federal Salary Council, who says the key to bringing in new talent — and making sure they stay — is modernizing the GS system.

“First you need to talk about creating an environment that’s attractive for people that would actually want to come here and work for the federal government,” Condrey said in an interview on In Depth with Francis Rose.

Condrey said evidence of the aging pay system can be seen in the widening gap between federal-employee pay and their private-sector counterparts. Late last year, the Federal Salary Council reported the pay gap, which is calculated by comparing the average salaries earned by federal employees to private-sector workers doing similar work in the same geographic areas, had widened to more than 35 percent.

While a slight pay bump ordered by President Barack Obama for this year — the first pay increase since 2010 — will probably help lessen that gap, Condrey said it’s also worth looking at updating some of the underpinnings of the entire GS system.

For example, Condrey suggested adjusting the pay range for salaries within the GS system.

“The pay range now is only 30 percent from minimum to maximum,” he said.

This ends up leading to salary compression particularly in the higher grade levels. It’s also outside the norm for the private sector, where the average pay range is closer to 50 percent, he said.

GS system prone to grade creep?

Congress devised the GS system, comprised of 15 grade levels and 10 intermediate step levels, in 1949. At the time, more than 75 percent of the federal workforce held clerical positions in mostly entry-level positions — grades GS-7 and below. Just under a quarter of federal employees in the GS system fall into those lower grade levels today.

But Condrey said the increasing concentration of employees in higher grades has been driven in large part by the increased professionalization of federal work.

“You don’t have as many clerk-typists and things of that nature,” he said. “Jobs, themselves, have evolved so they’re really at a higher level. So you really don’t see a lot of those lower-graded positions.”

In addition, policymakers should consider making some targeted tweaks to the GS system particularly between grades 8 and 9, Condrey said.

“Grade 9 is really where your professional level employees start and if you were to increase that gap, say another 5 or 10 percent, and just move everything up and you move the scale out, then you could essentially solve some of that problem right there,” he said.

“That’s a pretty easy fix,” he added. “It just takes the political will to do it.”

In recent years, the Obama administration has also called for reforms to the GS system. The administration’s fiscal 2015 budget request called the current pay system “inflexible and outdated.”

There’s also interest on Capitol Hill in revising the GS system. Last year, members of the House Oversight and Government Reform Committee requested the Government Accountability Office look into the current system’s shortcomings.

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