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entitled 'Human Capital: Retirements and Anticipated New Reactor 
Applications Will Challenge NRC's Workforce' which was released on 
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Report to the Subcommittee on Oversight of Government Management, the 
Federal Workforce, and the District of Columbia, Committee on Homeland 
Security and Governmental Affairs, U.S. Senate: 

United States Government Accountability Office: 

GAO: 

January 2007: 

Human Capital: 

Retirements and Anticipated New Reactor Applications Will Challenge 
NRC's Workforce: 

Nuclear Regulatory Commission: 

GAO-07-105: 

GAO Highlights: 

Highlights of GAO-07-105, a report to the Subcommittee on Oversight of 
Government Management, the Federal Workforce, and the District of 
Columbia, Committee on Homeland Security and Governmental Affairs, U.S. 
Senate 

Why GAO Did This Study: 

The Nuclear Regulatory Commission (NRC) is responsible for licensing 
and inspecting the nation’s nuclear power plants to ensure their safety 
and security. By 2010, about one third of NRC’s workforce with mission-
critical skills will be eligible to retire. At the same time, NRC’s 
workforce needs to expand because NRC expects to receive at least 20 
applications for 29 new nuclear power reactors beginning in October 
2007. GAO assessed NRC’s ability to meet its workforce needs by 
examining the extent to which NRC (1) has aligned its human capital 
planning framework with its strategic mission and programmatic goals; 
(2) is effectively recruiting, developing, and retaining critically 
skilled personnel; and (3) is addressing future uncertainties that 
could affect its overall workforce capacity. GAO examined strategic 
workforce planning and implementation documents, interviewed cognizant 
managers on NRC’s human capital framework and activities, and surveyed 
these managers about NRC’s human capital flexibilities and measures. 

What GAO Found: 

NRC’s human capital planning framework is generally aligned with its 
strategic goals and coherently identifies the activities needed to 
achieve the following strategic human capital outcomes: (1) continuous 
improvement in leadership and management effectiveness in delivering 
the mission and (2) a diverse, skilled workforce and an infrastructure 
that fully supports the agency’s mission and goals. To integrate its 
human capital planning with implementation activities, NRC has recently 
completed or drafted three key planning documents and created a Human 
Capital Council in July 2006. However, it is too soon to tell whether 
implementation of these initiatives will stimulate, for example, the 
rate of knowledge transfer necessary for new staff to gain the critical 
skills they need to perform their regulatory responsibilities. 

NRC has been effective in recruiting, developing, and retaining a 
critically skilled workforce to date, yet it is unclear whether this 
trend will continue in the next few years. For example, through 
improving such processes as how it implemented hiring for 60 different 
vacancy postings, NRC brought 371 employees on board during fiscal year 
2006—a substantially higher number than in previous years. Similarly, 
NRC filled several critical skills gaps in 2006, yet it also identified 
many more new gaps in 2007 that require significant new hiring or 
training to fill. NRC has used various targets and measures to monitor 
its human capital progress, but could improve their application by 
gathering, analyzing, and sharing information about their usefulness 
among NRC’s offices and revising some of them. Similarly, NRC may miss 
opportunities to most effectively apply human capital funding to 
recruit, develop, and retain a critically skilled workforce because NRC 
evaluates only some of its human capital flexibilities, such as 
recruitment incentives, in terms of the frequency and cost of their 
use. 

NRC has acted to address two key uncertainties that affect its 
workforce needs: whether it can (1) maintain its workforce in the face 
of future competition for critically skilled workers and (2) accurately 
gauge its future workload. To better compete for workers, NRC tracks 
salaries in key disciplines to discern trends and is enhancing its 
university recruiting efforts. To handle the expected growth in reactor 
license applications, NRC has developed staffing and resource 
estimates, is reorganizing its affected workforce, and completed many 
elements of its review process for new reactors. Because of its 
workforce changes and anticipated increased workload, NRC needs 
flexibility, staff commitment, and sustained human capital management 
to adapt to any workforce climate shifts. Similarly, workload 
imbalances among employees and across offices could undermine employee 
satisfaction, making the recruiting and retention of a diverse, skilled 
workforce more difficult as expected industry competition intensifies. 
A failure to achieve these human capital goals could potentially hinder 
NRC’s ability to inspect existing reactors and license new ones, which 
might ultimately limit the availability of electricity in the U.S. 
market. 

What GAO Recommends: 

GAO is recommending that NRC better (1) integrate its strategic human 
capital planning with its operations and (2) evaluate the effectiveness 
of its human capital flexibilities and measures. In commenting on a 
draft of the report, NRC agreed with GAO’s recommendations. 

[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-07-105. 

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact Jim Wells at (202) 512-
3841 or wellsj@gao.gov. 

[End of Section] 

Contents: 

Letter: 

Results in Brief: 

Background: 

NRC's Human Capital Planning Framework Is Aligned with Its Strategic 
Mission and Programmatic Goals, but Some Further Actions Are Required: 

NRC Has Generally Been Effective in Recruiting, Developing, and 
Retaining Critically Skilled Employees, yet Many Activities Were Only 
Recently Initiated: 

NRC Is Taking Steps to Address Future Uncertainties That Could 
Adversely Affect Its Overall Workforce Capacity: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments: 

Appendix I: NRC's Changing Workforce Demographics: 

Appendix II: Scope and Methodology: 

Appendix III: New Reactor Licensing: 

Design Certifications: 

Combined Licenses: 

Appendix IV: Time Line of NRC's Workforce Reorganizations: 

Appendix V: NRC's Use of Human Capital Flexibilities, Authorities, 
Tools, and Programs: 

Appendix VI: Comments from the Nuclear Regulatory Commission: 

Appendix VII: GAO Contact and Staff Acknowledgments: 

Related GAO Reports: 

Tables: 

Table 1: GAO's Strategic Workforce Planning Principles and 
Descriptions: 

Table 2: Comparison of Selected NRC Workforce Demographics, Fiscal 
Years 2002 through 2006: 

Table 3: Percentage of the NRC Workforce that Is Eligible to Retire, 
Fiscal Years 2002 through 2011: 

Table 4: Employees Who Left NRC, Fiscal Years 2002 through 2006: 

Table 5: Status of Reactor Design Certification, December 2006: 

Table 6: NRC Managers' Assessment of the Use of Human Capital 
Flexibilities, Authorities, Tools, and Programs: 

Figures: 

Figure 1: NRC's Strategic Human Capital Planning and Implementation 
Framework: 

Figure 2: Twenty Potential COL Applications, as of December 2006: 

Abbreviations: 

ABWR: Advanced Boiling Water Reactor: 

CDMP: Comprehensive Diversity Management Plan: 

COL: combined license: 

DCRA: design-centered review approach: 

DOE: Department of Energy: 

EPR: Evolutionary Pressurized Water Reactor: 

ESBWR: Economic Simplified, Boiling Water Reactor: 

FTE: full-time equivalent: 

IG: Inspector General: 

NEI: Nuclear Energy Institute: 

NRC: Nuclear Regulatory Commission: 

NRR: Nuclear Reactor Regulation: 

NSIR: Nuclear Security and Incident Response: 

NTEU: National Treasury Employees Union: 

OHR: Office of Human Resources: 

OPM: Office of Personnel Management: 

SES: Senior Executive Service: 

SWP: strategic workforce planning: 

United States Government Accountability Office: 
Washington, DC 20548: 

January 17, 2007: 

The Honorable Daniel K. Akaka: 
Chairman: 
The Honorable George V. Voinovich: 
Ranking Minority Member: 
Subcommittee on Oversight of Government Management, the Federal 
Workforce, and the District of Columbia: 
Committee on Homeland Security and Governmental Affairs: 
United States Senate: 

The Nuclear Regulatory Commission (NRC) licenses and regulates civilian 
uses of nuclear materials to protect public health, safety, and the 
environment and promote the common defense and security. In particular, 
NRC is responsible for overseeing the electric power industry's 103 
operating nuclear reactors that generate about 20 percent of the 
nation's electricity by inspecting their operations and reviewing 
license applications to, for example, extend reactors' operating lives. 
Since October 2005, many electric power companies have announced their 
intent to apply to NRC for licenses to build and operate at least 29 
new nuclear power reactors, with project costs estimated to range from 
$1.5 billion to $4 billion. NRC expects to receive 8 applications by 
December 2007, 10 more applications by October 2008, and 2 additional 
applications by the end of September 2009--the first applications for 
construction licenses since the 1979 accident at the Three Mile Island 
nuclear power plant near Harrisburg, Pennsylvania. In addition, NRC is 
responsible for regulating the Department of Energy's (DOE) nuclear 
waste repository at Yucca Mountain near Las Vegas, Nevada, as well as 
medical, educational, and other uses of nuclear materials. 

Congress appropriated about $735 million for NRC's activities in fiscal 
year 2006. By law, NRC is required to recover about 90 percent of its 
budget authority each fiscal year, less certain specified amounts, 
through the fees it charges licensees and applicants. For fiscal year 
2007, the Continuing Appropriations Resolution, 2007, would limit NRC's 
appropriation to the fiscal year 2006 level, and Congressional leaders 
have announced their intent to extend the Continuing Resolution for the 
full fiscal year, with few exceptions. In its comments on a draft of 
this report, NRC states that the funding in the Continuing Resolution 
would result in a $95 million reduction in funding compared with the 
amount that the full House of Representatives and the Senate Committee 
on Appropriations had approved for fiscal year 2007. According to NRC, 
the agency has begun to feel the impact of the Continuing Resolution's 
restrictions on funding and full-time equivalent positions. NRC 
believes that these restrictions, if extended for a protracted period, 
will seriously imperil its ability to meet its human capital goals and 
will significantly delay its preparedness to review applications for 
new nuclear power reactors. NRC cites as an example that the agency 
would significantly curtail, and possibly cease, its fiscal year 2007 
new hiring, except for those already given offers and those necessary 
for the most critical of skills. NRC also believes that the effects 
will cascade into future years. 

To fulfill its regulatory mission and help sustain public confidence in 
the safety of nuclear power, NRC needs a critically skilled workforce 
of scientists, engineers, and other employees with specialized 
knowledge, skills, and technical expertise. However, NRC expects that 
the demographics of its workforce will significantly change in the next 
few years, primarily because of two factors. NRC estimates that the 
percentage of employees eligible to retire will grow from the current 
level of about 16 percent to about 33 percent of the workforce in 
fiscal year 2010. (See app. I for demographics data on NRC's 
workforce.) Nuclear power plant owners and NRC have expressed concerns 
about their ability to even maintain their workforces at current levels 
to ensure the safety of existing plant operations and the rigor of 
inspections as workers retire and reactors age. Furthermore, at the 
same time, NRC projects that its workforce size will need to grow from 
about 3,100 employees in early fiscal year 2006 to nearly 4,000 
employees by 2010 to meet the significant anticipated upsurge in 
workload demands as NRC begins to review power company applications for 
permits to construct and operate new nuclear reactors. To replace 
retiring employees and expand its workforce, NRC must hire from 300 to 
400 employees per year through at least 2010. 

In August 2004, NRC issued its Strategic Plan, Fiscal Year 2004-Fiscal 
Year 2009, which identifies the agency's vision; mission; values; and 
five goals--safety, security, openness, effectiveness, and excellence 
in agency management--shaping its activities through 2009. The 
strategic plan states that one of NRC's greatest management challenges 
will be to acquire, develop, and sustain a highly skilled and diverse 
technical workforce. Similarly, during the past 6 years, NRC's 
Inspector General (IG) has identified human capital management as a key 
challenge. To address these concerns, NRC developed the 2004-2009 
Strategic Human Capital and Workforce Restructuring Plan (2004 
strategic human capital plan), which presents strategies to ensure that 
the agency can recruit, develop, and retain the critically skilled 
workforce it needs.[Footnote 1] In recent years, NRC was identified as 
the federal government's third-best organization to work through an 
analysis of the Office of Personnel Management's (OPM) 2004 Federal 
Human Capital Survey data,[Footnote 2] and NRC improved its performance 
in 16 of 18 categories measured by its own 2005 Safety Culture and 
Climate Survey (NRC's 2005 employee survey) categories. 

Our December 2003 report on effective strategic workforce planning 
identified two critical elements: (1) aligning an organization's human 
capital program with its current and emerging mission and programmatic 
goals and (2) developing long-term strategies for acquiring, 
developing, and retaining staff to achieve program goals.[Footnote 3] 
The first element involves linking human capital management strategies 
with agency mission, goals, and organizational objectives and 
integrating these strategies into its strategic plans, performance and 
accountability plans, and budget requests. The second element involves 
undertaking workforce planning activities to implement acquisition, 
development, and retention programs. Strategic workforce planning 
involves systematic assessments of current and future human capital 
needs and the development of long-term strategies to fill any gaps. Our 
previous work suggests that, regardless of an agency's mission, needs, 
and approach, strategic workforce planning should incorporate the five 
key principles shown in table 1. 

Table 1: GAO's Strategic Workforce Planning Principles and 
Descriptions: 

Principle: Involve top management, employees, and other stakeholders in 
developing, communicating, and implementing the strategic workforce 
plan; 
Description: Agencies' top program and human capital leaders set the 
overall direction, pace, tone, and goals and involve employees and 
stakeholders in establishing a communication strategy that creates 
shared expectations for the outcomes of the process. 

Principle: Determine the critical skills and competencies that will be 
needed to achieve future programmatic results; 
Description: Agencies determine how many personnel have the skills and 
competencies needed to meet program goals and how many are likely to 
remain with the agency over time, given retirement and other attrition. 
Such analysis allows agencies to identify the resources needed to 
achieve current and future goals. 

Principle: Develop strategies that are tailored to address gaps and 
human capital conditions in critical skills and competencies that need 
attention; 
Description: Agencies use strategies, including programs, policies, and 
practices, to address how the workforce is acquired, developed and 
trained, compensated; deployed; motivated; and retained. Such 
strategies help an agency move from the current to the future 
workforce. 

Principle: Build the capability needed to address administrative, 
educational, and other requirements important to support workforce 
strategies; 
Description: Agencies educate managers and employees about available 
human capital flexibilities so that the flexibilities are implemented 
openly, fairly, and effectively. 

Principle: Monitor and evaluate the agency's progress toward its human 
capital goals and the contribution that human capital results have made 
toward achieving programmatic goals; 
Description: Agencies use periodic measurement and evaluation to obtain 
data for identifying shortfalls and revising future workforce planning 
efforts. Gathering this information helps ensure that human capital 
strategies work as intended. 

Source: GAO. 

[End of table] 

Given the anticipated increase in NRC's future workload, we assessed 
NRC's ability to sufficiently recruit, develop, and retain the staff it 
needs to inspect the operations of existing nuclear power plants, 
review the license applications for constructing new reactors, and 
perform other regulatory functions. Specifically, we examined the 
extent to which NRC (1) has aligned its human capital planning 
framework with its strategic mission and programmatic goals; (2) is 
effectively recruiting, developing, and retaining critically skilled 
personnel; and (3) is taking steps to address future uncertainties that 
could affect its overall workforce capacity. 

To assess the alignment of NRC's human capital framework with its 
strategic mission and programmatic goals, we analyzed a broad range of 
NRC's policy, planning, and implementation documents; reviewed budget 
documents and performance and accountability reports; and interviewed 
cognizant managers in NRC's Office of Human Resources (OHR), program 
offices--including Nuclear Reactor Regulation (NRR), and four regional 
offices. To assess NRC's efforts to recruit, develop, and retain 
critically skilled personnel, we applied our five strategic workforce 
planning principles. In doing so, we analyzed NRC's (1) demographics 
data; (2) critical skills information; (3) implementation of its 
recruiting, hiring, training and development, and retention strategies; 
(4) implementation of new systems, programs, and processes that support 
human capital management and planning; and (5) measures of its progress 
and results. We also surveyed 45 NRC managers in OHR, NRR and other 
program offices, and four regional offices about the use of existing 
human capital flexibilities, authorities, tools, and programs; our 
response rate was 71 percent. To assess the extent to which NRC has 
addressed future uncertainties that could adversely affect its overall 
workforce capacity, we examined the engineering, science, and 
technology labor pool and NRC's efforts to prepare for a surge in new 
reactor license applications. Specifically, we interviewed NRC managers 
and Nuclear Energy Institute (NEI) executives about the supply and 
demand for critically skilled workers, examined NRC's efforts to 
develop a "pipeline" for recruiting these personnel, and assessed its 
need for any new flexibilities and authorities. (See app. II for 
additional information about our scope and methodology.) We conducted 
our work from March through December 2006 in accordance with generally 
accepted government auditing standards. 

Results in Brief: 

NRC's human capital planning framework is generally aligned with its 
strategic outcomes and goals. NRC's strategic plan and associated plans 
coherently outline its human capital goals, strategies, performance 
measures, and activities, and these elements are linked to NRC's 
strategic outcomes: (1) continuous improvement in NRC's leadership and 
management effectiveness in delivering the mission and (2) a diverse, 
skilled workforce and an infrastructure that fully supports the 
agency's mission and goals. Although its framework is generally sound, 
NRC has not fully implemented three key plans that would facilitate the 
recruitment and development of employees who its offices need to 
maintain agency expertise and to respond to anticipated growth in 
applications for reactor licenses in the next few years. For example, 
NRC's 2004 strategic human capital plan called for annual agencywide 
human capital implementation plans beginning in October 2005 that would 
link NRC strategies to its offices' tactical planning for accomplishing 
yearly goals. However, NRC has drafted but has not completed its first 
annual implementation plan, in part because of competing human capital 
demands particularly the need to achieve its sharply increased hiring 
targets. Without the plan, NRC managers face increased complexity and 
difficulty in managing activities to recruit and develop the critically 
skilled employees they will need. Similarly, although NRC recently 
completed two agencywide strategic documents for knowledge management 
and training and development, it remains to be seen whether NRC 
managers' implementation of these initiatives will stimulate, for 
example, the rate of knowledge transfer necessary for new staff to gain 
the critical skills they need to perform their regulatory 
responsibilities. In addition, although NRC created a Human Capital 
Council in July 2006 to formulate and integrate strategies for NRC's 
offices to address human capital challenges, it is too early to 
determine whether the council can balance its responsibility both to 
develop solutions and to provide strategic direction for effectively 
addressing these key challenges. Accordingly, we are recommending that 
NRC take actions to better integrate its strategic human capital 
planning into its implementation activities. NRC agreed with our 
recommendation. 

NRC has been effective in recruiting, developing, and retaining a 
critically skilled workforce to date, and has taken several actions in 
2006 to increase its overall workforce capacity, but because NRC has 
not fully implemented some of its planned efforts to enhance its hiring 
and training, it is unclear whether this performance will be sustained. 
NRC has addressed our five key principles for strategic workforce 
planning and has used its human capital tools, authorities, and 
flexibilities to recruit, develop, and retain the critically skilled 
workers it needs; however, the agency has not evaluated the 
effectiveness of some of these flexibilities. For example, its 
leadership and management have been extensively involved in 
establishing, communicating, and implementing workforce planning 
strategies. NRC also has developed a process that inventories existing 
critical skills and compares them with needs to identify gaps. 
Furthermore, NRC uses many targets and measures to monitor the status 
of its efforts, such as the composition of its hires and separations. 
As a result, during fiscal year 2006, NRC exceeded its initial goal of 
hiring 300 new staff by bringing 371 employees on board, which was 
substantially higher than in previous years. Of these new workers, 54 
percent were midlevel hires--many with nuclear industry experience--who 
typically require less training before performing their jobs than entry-
level hires from universities. 

Although NRC has strengthened its efforts to identify and fill critical 
skills gaps, it is too early to assess the effectiveness of some 
strategies that were put into practice during fiscal year 2006. For 
example, NRC closed about 55 critical skills gaps but identified 115 
additional critical skills gaps, many of which will require 1 year or 
more of classroom and on-the-job technical training to fill. NRC also 
does not systematically evaluate its use of human capital authorities 
and flexibilities--such as recruitment incentives or early replacement 
hiring--for recruiting, developing, and retaining a critically skilled 
workforce, although it tracks the frequency of use and associated costs 
for some of these authorities and flexibilities. Without this 
information, NRC may either under-or over-use certain authorities and 
flexibilities and inefficiently use its annual human capital funding. 
In addition, NRC managers told us that while some human capital 
measures and targets are reliable and useful, others do not provide 
sufficiently meaningful information to assess progress. NRC planned in 
2004 to develop a human capital accountability system plan that, in 
part, would describe the measures, metrics, and associated targets 
needed to assess its achievement of human capital outcomes; this plan 
has not yet been drafted. Without this framework, it is difficult for 
offices to identify useful practices and improve agencywide 
understanding of how human capital activities directly support the 
achievement of agency goals and strategic outcomes. Furthermore, 
although NRC has previously surveyed employees about their satisfaction 
with its human capital program, the agency does not plan to conduct a 
survey during fiscal year 2007 even though doing so could provide a 
useful, updated perspective in assessing initiatives as NRC continues 
to expand its workforce. Accordingly, we are recommending that NRC take 
actions to evaluate (1) the effectiveness of its use of human capital 
tools, authorities, and flexibilities and (2) the usefulness of its 
human capital measures; intended outputs; and targets for recruiting, 
developing, and retaining a critically skilled workforce. We are also 
recommending that NRC survey its employees during fiscal year 2007 
about their satisfaction with its human capital program, including new 
initiatives and offices' use of flexibilities to maintain a quality 
work environment. NRC agreed with our recommendations. 

NRC has acted to address two key uncertainties that affect its 
workforce needs--that is, whether it can (1) maintain its workforce in 
the face of future competition with the nuclear power industry for 
critically skilled workers and (2) accurately gauge its workload, 
particularly for reviewing license applications for new nuclear 
reactors, during the next 3 years so it can meet its commitments for 
timely reviews while ensuring nuclear power plant safety and security. 
Regarding its ability to continue to attract and retain key personnel, 
NRC annually tracks the number and salaries of U.S. scientists and 
engineers in a few key disciplines to discern shifting trends. NRC also 
has initiated additional activities, authorized by the Energy Policy 
Act of 2005, to support key university programs to attract greater 
numbers of students into mission-critical skills areas, and to offer 
scholarships to those studying in these fields. Such activities have 
the potential to enhance the quality of NRC's entry-level candidate 
pool with a pipeline of critically skilled candidates. Nevertheless, 
NRC will face greater competition in attracting and retaining 
experienced scientists and engineers, and, further complicating 
matters, NRC generally employs only U.S. citizens in these positions. 
Regarding the anticipated growth of license applications for new 
reactors, NRC expects to complete its review of applications within 42 
months, including holding required public hearings. Although NRC's 
process is intended to allow for a more efficient review of combined 
license applications and is generally supported by the nuclear power 
industry, it is as yet untested. In addition, in anticipation of 
receiving an initial wave of applications in October 2007, NRC has 
periodically met with power company representatives to discuss and 
resolve matters related to how the process is to move forward. 

Background: 

The Energy Reorganization Act of 1974 established NRC as an independent 
agency, headed by a five-member Commission, to regulate the nation's 
civilian use--commercial, industrial, academic, and medical--of nuclear 
energy and materials, including nuclear power reactors and research and 
test reactors.[Footnote 4] NRC's mission is to ensure that civilian 
users of nuclear materials adequately (1) protect public health and 
safety; (2) promote the common defense and security, including securing 
special nuclear materials against radiological sabotage and theft or 
diversion; and (3) protect the environment. NRC's total operating 
budget, excluding the IG's office, grew from about $618 million in 
fiscal year 2004 to about $735 million in fiscal year 2006.[Footnote 5] 
While NRC requested about $808 million for fiscal year 2007, the 
Continuing Appropriations Resolution, 2007, limits its appropriations 
to the fiscal year 2006 funding level. Similarly, NRC's funding 
allocations for recruiting, training, and other human capital 
activities have grown from a total of $35 million, or 6 percent of its 
total operating budget, in fiscal year 2004 to about $61 million, or 8 
percent of its planned allocations, in fiscal year 2007.[Footnote 6] 

About 70 percent of NRC's workforce in fiscal year 2006 was dedicated 
to ensuring the safe and secure operation of civilian nuclear power 
reactor facilities and research and test reactors. NRC estimates that 
at least 500 new critically skilled positions will be added through 
fiscal year 2009, primarily to license and inspect the construction of 
new reactors. (See app. III for more information on NRC's new reactor 
licensing process.) NRC's reactor safety activities and their related 
percentages of NRC's workforce include the following: 

* reactor licensing: power upgrades (approving increases in the 
allowable level of generated power) and license transfers, operator 
licensing, regulation development, operating experience evaluation, and 
financial assurance (25 percent of NRC's workforce); 

* reactor license renewal (3 percent); 

* new reactor licensing (6 percent); 

* reactor inspection and performance assessment: emergency preparedness 
and incident response, reactor technical and regulatory training, 
imposition of enforcement sanctions for violations of NRC requirements, 
and investigation of alleged wrongdoing by licensees, applicants, 
contractors, or vendors (30 percent); 

* homeland security activities: threat assessment, safeguards and 
security reviews and inspections, force-on-force exercises, and 
regulatory infrastructure (5 percent); and: 

* international efforts to enhance domestic and global nuclear safety 
(1 percent). 

In fiscal year 2006, about 28 percent of NRC's workforce was devoted to 
the following nuclear materials and nuclear waste safety activities to 
secure the use and management of radioactive materials: 

* nuclear fuel cycle facilities (6 percent of NRC's workforce); 

* nuclear materials activities (10 percent); 

* repository or disposal of high-level waste--specifically, licensing 
decisions and regulatory oversight (4 percent); 

* decommissioning of nuclear reactors and other facilities, and low- 
level waste management (almost 4 percent); and: 

* storage and transportation of spent nuclear fuel both at and away 
from reactor sites (almost 4 percent). 

NRC estimates little growth in the number of personnel committed to 
these activities, with some slight increases related to fuel cycle 
production facilities and possibly high-level waste storage, depending 
upon DOE's submission of its license application for the Yucca Mountain 
repository.[Footnote 7] In fiscal year 2007, NRC expects to oversee 
more than 4,400 licenses for nuclear materials and nuclear waste 
safety, while 34 Agreement States will regulate and oversee over 18,000 
licenses.[Footnote 8] 

NRC's Human Capital Planning Framework Is Aligned with Its Strategic 
Mission and Programmatic Goals, but Some Further Actions Are Required: 

NRC's human capital planning framework is generally aligned with its 
strategic mission, outcomes, and programmatic goals; however, some key 
plans and activities are still being developed or implemented. 

NRC's Strategic Human Capital Planning Framework Is Coherently Aligned: 

NRC's human capital planning framework has generally aligned human 
capital activities with NRC's management goal and the goal's strategic 
outcomes. NRC also has taken significant steps, particularly during 
fiscal year 2006, to ensure that human capital plans and strategies are 
demonstrated through its human capital activities by achievement of 
agencywide and office-specific goals and outcomes. In addition, NRC's 
strategic and existing operational planning documents link human 
capital goals and strategies to several agencywide performance 
measures. 

A critical success factor for high-performing organizations is the 
alignment of their human capital initiatives with mission and goal 
accomplishment. Alignment is demonstrated by linking human capital 
management strategies with agency mission, goals, and organizational 
objectives and integrating these strategies into its strategic plans, 
performance and accountability plans, and budget requests. This linkage 
allows agencies to assess and understand the extent to which their 
workforce contributes to achieving the overarching mission. 

As shown in figure 1, NRC's strategic human capital approach 
demonstrably supports the agency's organizational performance 
objectives. Together, NRC's plans and strategies, programs, and 
activities provide a coherent structure designed to support NRC's 
safety and security mission. Specifically, NRC's strategic plan 
outlines six human capital strategies that delineate how the agency 
will achieve its strategic outcomes of (1) continuous improvement in 
NRC's leadership and management effectiveness in delivering the mission 
and (2) a diverse, skilled workforce and an infrastructure that fully 
support the agency's mission and goals. 

Figure 1: NRC's Strategic Human Capital Planning and Implementation 
Framework: 

[See PDF for image] 

Source: GAO analysis of NRC documents. 

[End of figure] 

NRC has also taken significant steps to ensure that human capital plans 
and strategies are implemented to achieve agencywide and office- 
specific goals and outcomes. For example, NRC's 2004 strategic human 
capital plan delineates tools, authorities, flexibilities, and programs 
for hiring, developing, and retaining personnel, most of which NRC 
currently uses. The strategic human capital plan also directs the 
development of several additional plans, strategies, and activities-- 
many of which have been put into place--to achieve the workforce needed 
to accomplish NRC's goals. NRC's strategic and existing operational 
planning documents also link human capital goals and strategies to 
several agencywide performance measures, in part illustrated in its 
annual performance budget and accountability reporting. 

Some Key Human Capital Planning and Implementation Efforts Are Still in 
Process: 

While NRC's planning framework delineates the relationship between 
human capital activities and strategic outcomes, some key plans are 
still being developed, completed, or put into practice. Although most 
of NRC's agencywide and office specific plans provide human capital 
management strategies, the linkage is not fully delineated between 
generally identifying strategies and selecting and deploying particular 
strategies. 

An agency that is successful in aligning and integrating human capital 
approaches and goals considers further initiatives and refinements when 
organizational needs change or when successes or shortcomings of its 
human capital efforts are demonstrated.[Footnote 9] NRC is currently 
undergoing such a transition because the agency, both in terms of 
demographics and workload, will have increasing and diverse human 
capital needs in coming years. In response, during fiscal year 2006, 
NRC initiated a range of activities, in various stages of completion, 
intended to provide a more robust framework through which to operate 
during the next few years. For example: 

* Since late 2005, NRC's four regional offices have developed or are 
further implementing human capital management plans that reflect their 
human capital activities. The general framework of these plans mirror 
NRC's 2004 strategic human capital plan. 

* In August 2006, NRC adopted a more comprehensive approach to its 
knowledge management and knowledge transfer. NRC's prior approach to 
knowledge management did not fully support the agency's need for a 
faster rate of knowledge transfer to accommodate increasing 
retirements, midcareer turnover, agency growth, and the broader scope 
of knowledge needed, for example, to support new technologies and new 
reactor designs. NRC's new framework provides significant direction and 
detail regarding how knowledge management can be accomplished. However, 
it remains to be seen whether implementation of these initiatives will 
stimulate the rate of knowledge transfer necessary for new staff to 
gain the critical skills they need to perform their regulatory 
responsibilities. 

* In fiscal years 2006 and 2007, NRC has been developing common 
measures for offices to monitor and evaluate performance in support of 
the goals in its 2004 Comprehensive Diversity Management Plan (CDMP) to 
(1) recruit diverse employees at all levels, (2) develop and retain 
diverse employees by promoting an environment that values differences, 
and (3) increase the diversity of employees in senior and managerial 
positions. CDMP was designed to promote strategies that increase NRC's 
organizational capacity, guide decisions and practices that impact 
equal opportunity, and promote the principles of diversity management. 

* In early 2006, NRC developed a more detailed agencywide list of best 
practices strategies and actions for achieving equal employment 
opportunity goals through recruiting, staff development, merit process, 
inclusion and workforce culture, awards and recognition, communication, 
action tracking, and organization assessment. These best practices 
strategies and actions complement CDMP strategies.[Footnote 10] 

* In September 2006, NRC finalized a strategic training and development 
plan to more specifically identify how existing efforts to ensure the 
effectiveness and efficiency of training will be augmented and 
integrated. The plan's goals are to enhance individual performance, 
meet agency needs, ensure resources are optimized, and confirm the 
extent to which NRC is realizing training benefits. 

* During fiscal year 2006, NRC identified inefficiencies in 
coordinating and integrating planning and operations, stretching its 
human capital resources to hire and meet the need for nearly double the 
number of new employees than in previous years. In part, NRC's 
intensified activity demonstrated that coordination among human 
resources and program offices, although considerable, was not yet 
optimized. In response, in July 2006, NRC created a Human Capital 
Council composed of office deputy directors and a deputy regional 
administrator to provide a senior leadership and programmatic 
perspective.[Footnote 11] OHR chairs and supports the council, whose 
purpose is to provide an agency-level forum to formulate strategies to 
address human capital challenges, share best practices, and develop an 
integrated approach to address human capital issues. The council is 
expected to make recommendations for action to the Executive Director 
for Operations and Chief Human Capital Officer to improve the agency's 
management of human capital. The council also intends to identify ways 
by which OHR personnel can more proactively support program offices and 
solve problems. However, it is too early to determine whether the 
council can balance its responsibility to provide both strategic 
direction and develop an integrated approach for effectively addressing 
these key challenges. 

* NRC has drafted but has not completed its first annual human capital 
implementation plan, in part because of the need to support competing 
human capital demands, particularly NRC's sharply increased hiring 
targets.[Footnote 12] Similar to the aims of the Human Capital Council, 
the implementation plan would serve to link strategic planning to 
operational planning and implementation efforts. At least one program 
office, NRR, has developed such a plan, which both demonstrates 
alignment to NRC's 2004 strategic human capital plan and provides much 
more specificity on the means to achieve and implement human capital 
strategies. Without the plan, NRC managers face increased complexity 
and uncertainty in managing recruitment and development activities for 
the critically skilled employees they will need. 

It is too soon to determine the extent to which these recent efforts, 
taken together or separately, will help NRC to more effectively respond 
both to continuing and new workforce demands during 2007 through 2010, 
and beyond. The urgency to incorporate strategic human capital 
management principles more explicitly into operations may vary across 
program offices, in part because of somewhat different program needs or 
requirements. Because key internal stakeholder commitment and 
involvement will dictate their success, the further development and use 
of these plans and activities are likely contingent on whether 
stakeholders consider them necessary and effective for integrating 
NRC's human capital activities and enable them to achieve the desired 
results. 

NRC Has Generally Been Effective in Recruiting, Developing, and 
Retaining Critically Skilled Employees, yet Many Activities Were Only 
Recently Initiated: 

To date, NRC's approach for recruiting, developing, and retaining a 
critically skilled workforce has generally been effective and addresses 
our five key principles for effective strategic workforce planning. 
NRC's implementation of its workforce planning strategies demonstrates 
significant agency focus on achieving a diverse, skilled workforce to 
meet anticipated workload demands that it foresees in the next few 
years. For example, NRC has estimated the skills and personnel it needs 
for new reactor licensing and exceeded its fiscal year hiring target by 
bringing on 371 new employees. However, because of substantial 
challenges facing NRC and because several efforts have not yet been 
fully put into practice, the framework's overall effectiveness in 
collectively enhancing NRC's overall workforce capacity is not fully 
clear. As a result, while NRC determined that it closed about 55 
critical skills gaps in fiscal year 2006, it also identified 115 new 
gaps and 76 continuing or long-term gaps, many of which will take a 
significant amount of training and development to be considered filled. 
NRC has proposed to increase funding for leadership, training and 
development, and knowledge management by 37 percent in its fiscal year 
2007 budget request in an effort to further close these gaps. In 
addition, NRC's use of its flexibilities could be further improved by 
systematically evaluating how they contribute to desired outcomes. 
Similarly, NRC could revise some of its measures, metrics, and targets 
to better target and gauge agency progress. 

NRC's Management Is Significantly Engaged in Establishing, 
Communicating, and Implementing Strategic Workforce Planning Efforts 
and Strategies: 

Our prior work found that top leadership and management, when clearly 
and personally involved in workforce planning, can provide the 
organizational vision that is important in times of change, and can 
generate stability and cooperation within the agency to ensure that 
planning strategies are thoroughly implemented and sustained. With 
respect to our first principle, we found that over the past several 
years, NRC's top leadership has provided direction, and together with 
senior management, has become increasingly engaged in human capital 
management and strategic workforce planning.[Footnote 13] NRC's 2004- 
2009 Strategic Plan, which introduced a management goal and objectives 
specifically for strategic human capital management, was developed 
through high-level collaboration among the Deputy Executive Directors 
for Operations, the Chief Financial Officer, the four regional 
administrators, and the directors of program offices and OHR. 

Top leadership's involvement in strategic workforce planning and human 
capital activities is further evidenced through annual briefings to the 
Commissioners on human capital management; biannual briefings to the 
Commissioners on comprehensive diversity management; and the 
Commission's hosting of annual all-staff meetings, during which 
Commissioners communicate agency progress, discuss challenges the 
agency faces, and respond to employees' questions. During the past 
year, the Commissioners also solicited more information on, and 
provided more direction for, implementing such human capital activities 
as recruiting, hiring, and knowledge management. NRC managers generally 
told us that the agency's human capital approach plays a significant 
role in enabling NRC to attract, hire, and retain a diverse and skilled 
workforce. Overall, NRC's 2005 employee survey results showed that 
employee perceptions of management had improved since 2002; 
nevertheless, results also indicated that NRC management could further 
improve upon how it encourages employees to give their best. 

In emphasizing the importance of succession planning, senior NRC 
managers also said the agency is active in identifying and developing 
its midlevel and upper-level managers and leaders. Our prior work has 
found that such activities can positively affect an agency's ability to 
increase the retention of high-potential employees, maintain sufficient 
leadership capacity as senior executives retire, and achieve a more 
diverse workforce. NRC continued and intensified its succession 
planning activities in 2006 in light of agency growth and 
reorganization with managers conducting efforts to determine the 
appropriate skills and leadership "fit" for Senior Executive Service 
(SES) positions and anticipating replacement needs in 2-, 4-, and 6- 
year time frames.[Footnote 14] 

Our prior human capital work also found that an organization's 
effective use of communications strategies promotes transparency, 
creates shared expectations, and enables improved progress reporting. 
Although from 2001 to 2005, NRC's IG identified intra-agency 
communications as one of the most serious challenges facing the agency, 
it removed this challenge in its 2006 report because of various actions 
NRC has taken to improve internal communications. In addition, NRC's 
2005 employee survey results demonstrated a significant improvement 
over the 2002 survey results. The steps that NRC has taken include the 
following: 

* In response to a 2002 IG recommendation, NRC created a Communications 
Council in 2003. The council, which meets monthly, coordinates and 
launches internal communications initiatives, shares best practices, 
provides a forum for offices to advise and recommend further 
improvements, and posts meeting summaries to NRC's internal Web page. 

* Management has promoted transparency by developing and disseminating 
key information on its human capital policies, procedures, and 
processes through management directives and "yellow 
announcements."[Footnote 15] 

* To create shared expectations and buy-in, OHR conducts periodic video 
teleconferences with regional offices' management, supervisors, and 
staff to explain new policies and procedures. OHR also provides other 
face-to-face training as needed, typically on new developments or major 
changes in human capital policies and procedures. For example, in 2006, 
OHR and the General Counsel partnered to conduct focused training on 
such topics as merit staffing, performance and conduct issues, and 
equal employment opportunity, which NRC plans to incorporate into its 
formal supervisory curriculum. 

* The NRC Reporter, a weekly newsletter instituted in early 2005, 
provides employees with information on various agency initiatives, and 
an Executive Director for Operations Update, introduced in 2002, 
discusses operational activities on a weekly to biweekly basis. 

* NRC's Web site and Agencywide Document and Access Management System 
also provide easy access to human capital materials, including 
transcripts of annual briefings, planning documents, and its "human 
capital management tool box." 

* NRC routinely solicits feedback or comments from offices, employees, 
and the National Treasury Employees Union (NTEU) on the introduction of 
new or major changes to flexibilities, policies, and 
procedures.[Footnote 16] 

* NRC's 2005 employee survey results on NRC's Differing Professional 
Opinions Program, through which employees can provide alternative 
professional theories or opinions, demonstrated no statistically 
significant increase in this category's results since 2002, and NRC 
identified it as an area for improvement. A key senior manager also 
noted that concern still existed about this program yet encouraged its 
use, saying that such opinions and resulting discussions make NRC's 
organizational safety and security mind-set sounder. 

Although NRC has demonstrated efforts in the above areas, opportunities 
exist to further enhance its capability to monitor and measure its 
human capital success and progress. We have found that leading 
organizations have periodically sought their employees' input and 
explicitly addressed that input to adjust their human capital 
approaches[Footnote 17]. One way agencies assess employee satisfaction 
and leadership and management practices that contribute to agency 
performance is through employee surveys. NRC's IG conducts its Safety 
Culture and Climate Survey every few years, the last being in 2005; NRC 
also participates in OPM's biannual Federal Human Capital Survey, most 
recently conducted in 2006. Even though (1) at least one third of its 
workforce will be directly affected by office reorganizations or 
expansions, (2) several key human capital efforts are to be further 
implemented, and (3) over 200 retirements or resignations are 
anticipated, NRC does not plan to conduct an employee survey during 
fiscal year 2007. Employee survey results could provide NRC managers 
with employees' feedback that could be used to adjust the human capital 
approaches as appropriate during this particularly critical year. 
Without such data as a key basis for understanding the workforce 
climate, it will be more difficult for NRC to gauge any shifting 
trends, determine strategies to address any problems, and report on 
actions it has taken to move forward. 

NRC managers and a key NTEU official we interviewed said that their 
relationship, characterized as somewhat tenuous, could also be 
improved. NTEU officials told us that NTEU's influence had diminished 
somewhat in recent years because (1) since 2001, federal agencies are 
no longer required to establish partnerships with their labor 
organizations;[Footnote 18] (2) the union's own leadership style was 
not always conducive to effecting change; and (3) the union provided 
limited resources and incentives to stimulate active participation of 
its members. NTEU officials and NRC managers also had differing views 
on how to facilitate Agency Labor-Management Partnership Committee 
meetings between senior union officials and NRC managers, yet they 
agreed on the need to raise issues appropriate for committee 
consideration. NRC managers and NTEU officials told us that they plan 
to defer renegotiation of the NTEU contract until 2008, although they 
recognize NRC's work environment is rapidly changing. 

NRC Analyzes Its Mission Priorities and Workforce Capacity to Identify 
Ongoing and Future Critical Skills Needs: 

Our prior work found that maintaining information on the critical 
skills and competencies that an organization's personnel possess is 
especially important for federal agencies operating in a changing 
environment.[Footnote 19] Shifts in national priorities, advances in 
technology, budget constraints, and other factors affect the critical 
skills an agency needs to fulfill its mission. NRC annually analyzes 
its workforce's skills by gathering data on employee skills and 
competencies, identifying the existing and future critical skills 
needed, and determining if and where gaps exist. As a result of this 
process, which has become increasingly institutionalized since 2002, 
NRC reviews its existing workforce characteristics, identifies ongoing 
and future critical skills needs, and tracks critical skills gaps. 
Engineers and scientists, who represent about half of the overall 
workforce, are the more evident of NRC's critically skilled population; 
however, NRC has identified the fields of contracting, law, security, 
and risk assessment, among others, as mission-critical skills. In 
addition, because of increased homeland security requirements, NRC's 
critical skill set has broadened in recent years to include more 
expertise in materials and reactor security, emergency preparedness, 
and incident response. 

For NRC's annual critical skills assessment, (1) employees inventory 
their skills, competencies, and levels of expertise; (2) office and 
branch managers assess the supply of and demand for general and 
particular skills; and (3) OHR personnel further analyze this 
information to determine agencywide critical skills needs. The primary 
tool NRC uses to gather detailed data on an employee's critical skills 
and competencies is its strategic workforce planning (SWP) system 
database, which was developed in 2002. The SWP system identifies the 
critical skills and competencies each employee possesses, his or her 
career stage, and his or her retirement eligibility dates. Supervisors, 
managers, or human resources personnel can then generate summary 
reports with a range of parameters. The SWP system's staff and critical 
skill matrix lists all staff in a given branch or office, and indicates 
each employee's skill level, title, retirement eligibility date, and 
years until retirement. OHR and program office managers told us that 
the SWP system's accessibility and utility have improved in the last 2 
years. Some program managers noted that they have used SWP data to 
identify potential skills needs and gaps, to inform decisions when 
assigning work, and for succession planning. These managers noted that 
the SWP system requires recurring employee input and managerial and 
supervisory inputs and analysis to be effective. In 2006, over 80 
percent of employees and supervisors updated their skills and 
anticipated needs, respectively. 

In addition to gathering skills information, NRC has conducted an 
annual agencywide needs and gaps assessment since 2003. More 
specifically, program office managers assess the supply of and demand 
for general and particular skills in their offices and branches, given 
their existing and anticipated workload. The offices each identify 
their "most critical" needs.[Footnote 20] They then categorize these 
needs as either near term (0 to 2 years) or long term (3 to 5 years), 
and their importance as either top tier or second tier. Then, OHR 
compiles these assessments, conducts further analyses, and reports the 
results to senior NRC managers and program offices. NRC's fiscal year 
2006 analyses identified over 300 critical skills needs, over 100 of 
which were categorized as top tier. 

In preparation for reviewing combined license (COL) applications for 
constructing and conditionally operating new nuclear reactors and 
plants, NRC has assessed the range and magnitude of critical skills 
needs. Specifically, NRC conducted a job-task analysis in early 2006 to 
better define anticipated critical skills needs by identifying detailed 
tasks, competencies, and skills associated with prior reactor license 
application reviews. NRC managers determined that a large majority of 
skills associated with current licensing, regulatory, and technical 
expertise related to existing reactors are "portable" to the new 
reactor licensing reviews. These managers also identified a small 
number of new critical skills that are specific to new reactor 
licensing, such as hydrology and reactor physics. NRR then developed an 
initial resource estimate model that, in part, estimated critical 
skills needs by functional areas.[Footnote 21] Five skill sets--project 
management, civil engineering, instrumentation and controls, legal, and 
operator licensing--make up over 50 percent of the estimated effort, 
while about 17 other skill sets make up the remainder. In the summer of 
2006, NRR retained a contractor to develop a master project management 
plan for project planning and scheduling that would (1) support NRC's 
review of COL applications for constructing and conditionally operating 
a new reactor and (2) link critical skills needs to actual personnel, 
positions, and time frames. The plan, which will be completed in early 
2007, will estimate how to phase, project manage, and staff each aspect 
of the reviews, on the basis of validation of initial estimates. NRR is 
also developing a transitional staffing plan to identify the employees 
who will work in NRR and in NRC's newly established Office of New 
Reactors. (See app. IV for information about NRC's recent workforce 
reorganization and expansion.) In doing so, these managers said that 
the combined use of the SWP system, the resource estimate model, and 
the project management plan will inform how NRR will reorganize its 
personnel into the two offices and allocate its resources. 

NRC Primarily Uses Recruiting, Hiring, Training, and Development 
Strategies to Close Existing and Future Critical Skills Gaps: 

Our prior work has found that, to fill skills gaps, agencies need to 
develop human capital strategies and tools with the resources that are 
reasonably expected to be available. These strategies and tools 
encompass recruiting and hiring, training and developing staff and 
leadership, succession planning, knowledge management, and use of 
flexibilities. Agencies also need to align these strategies to 
eliminate gaps and optimize the contribution of current and future 
critical skills and competencies for mission success. 

NRC annually identifies critical skills gaps and develops strategies to 
address the gaps to achieve and maintain the level of expertise 
required to meet existing and anticipated workload demands. During the 
last 2 years, program office managers have relied on (1) recruiting and 
hiring and (2) training and development as their key gap closure 
strategies, among others. These also represent the majority of the 
tools, programs, authorities, and flexibilities NRC regularly employs 
as human capital strategies. 

NRC Significantly Increased Its Recruiting and Hiring Efforts and Its 
Use of Certain Flexibilities in Fiscal Year 2006: 

NRC's recruiting and hiring approach enabled the agency to exceed both 
its initial 2006 hiring target of 300 and its subsequent target of 350, 
by hiring 371 new employees who had reported as of September 30, 2006. 
NRC uses both general and specific vacancy announcements at the entry, 
mid, and upper levels that typically represent few to several critical 
skills areas in related disciplines and specialty areas.[Footnote 22] 
Fiscal year 2006 was the first year in over a decade that NRC's 
recruiting and hiring efforts were targeted at both replacing personnel 
leaving the agency and expanding its workforce--about half of the new 
hires replaced employees who left NRC through retirement or resignation 
and half increased NRC's total workforce to 3,347 employees.[Footnote 
23] In particular, NRR lost 75 employees--39 employees retired or 
resigned and 36 transferred to other NRC offices--but hired nearly 200 
employees, to staff both existing and new reactor licensing work. NRC's 
fiscal year 2007 hiring needs represent over 25 critical skills areas, 
and represent general and specific engineering and science fields as 
well as security, intelligence, information technology, contract 
management, human resources, and project management fields. 

NRC's approach is driven by the identification of critical skills needs 
and efforts to fill gaps, and includes the following activities: 

* NRC's annual recruiting call projects the agency's needs to hire 
entry-level and experienced employees with critical skills in 
particular disciplines. The fiscal year 2006 recruiting included 
general and specific engineering and science fields, security, 
information technology, and contract management fields. NRC's 
recruiting program includes visits to universities and professional 
society organizations to identify highly qualified candidates. 

* While the percentages vary somewhat from year to year, NRC generally 
brings on 60 to 70 percent of its new professional hires at the 
midlevel or upper level--frequently with several years of relevant 
professional experience--and the remainder of its hires at the entry 
level. About 200 of these hires--predominantly engineers, scientists, 
lawyers, human resource specialists, and contract specialists--came on 
at the midlevel or upper level in 2006, including over 50 hired from 
other federal agencies. Midlevel or upper level hires generally require 
less training than entry-level hires from universities to perform their 
jobs. 

More broadly, although the agency exceeded its hiring goals in fiscal 
year 2006, it is unclear whether NRC can effectively close critical 
skills gaps in the near and longer term. While the agency determined 
that it closed about 55 gaps in fiscal year 2006, it also identified 
115 new gaps and 76 continuing or long-term gaps.[Footnote 24] Most new 
NRC employees typically need from 1 to several years of targeted 
technical training, on-the-job experience, and/or development 
opportunities to fully learn and perform agency job functions, 
according to NRC managers. In addition, making determinations about 
whether gaps are sufficiently filled is an involved process and often 
depends on managers' understanding of each employee's knowledge and 
skills. However, maintaining that understanding will likely become more 
difficult as workforce demographics shift and NRC reorganizes and 
grows. In addition, gaps are determined at the branch level, reported 
at the office and regional levels, and compiled into an agencywide 
assessment. While some knowledge and skills are easily shared within 
branches, divisions, or offices, managers told us that the 
transferability of employees across these areas can be limited. 

NRC also uses various flexibilities in recruiting and hiring new 
employees, and it tracks the frequency and cost associated with the use 
of some flexibilities. (See app. V for NRC's use of human capital 
flexibilities, authorities, tools, and programs.) For example, we found 
that OHR, program, and regional managers identified recruitment 
incentives as among the most valuable of NRC's tools. Comparisons of 
recruitment incentive awards in fiscal years 2004 and 2006 show that 
(1) the number of awards increased from 6 to over 140, (2) total 
monetary awards increased from $77,000 to $979,000, and (3) the maximum 
value of an award increased from about $5,400 to over $20,000. NRC 
requested $1.25 million to make about 160 incentive awards in fiscal 
year 2007. In addition, NRC awards standardized recruitment incentives 
to many entry-level engineers and scientists and, on a case-by-case 
basis, to midlevel personnel who are typically in more specific 
critical skills areas. NRC tracks midlevel hires who received 
recruitment incentives--about 60 in fiscal year 2006--and at least 90 
percent worked in the private sector, including many for nuclear power 
plants or reactor vendors. 

NRC managers we interviewed and surveyed were generally satisfied with 
recruitment incentive awards and other available recruiting and hiring 
flexibilities, but they also said that direct hire authority would be a 
particularly useful recruiting and hiring tool.[Footnote 25] In March 
2006, OPM did not approve NRC's request to obtain this authority 
because it determined that the law does not apply to NRC's excepted- 
service positions. OHR managers told us that direct hire authority is 
among NRC's most wanted legislative authorities and that NRC is 
exploring avenues for obtaining it by, for example, requesting 
legislation. 

Although NRC tracks the frequency and cost associated with some 
recruiting and hiring flexibilities, it does not fully use some of 
these data to inform management decisions and further target recruiting 
and hiring efforts. Similarly, NRC does not systematically evaluate the 
extent to which the flexibilities positively affect its ability to 
realize a diverse, highly skilled workforce. For example, NRC does not 
assess the effectiveness of alternative recruitment incentives in 
attracting highly skilled employees or early replacement hiring that 
enables a new employee to work with a long-term employee who plans to 
transfer locations or retire. Without evaluating the effectiveness of 
its flexibilities, NRC may either under-or over-use certain authorities 
and flexibilities and inefficiently use its annual human capital 
funding. The Human Capital Council could provide a forum for evaluating 
the office-and agency-level implementation of human capital 
flexibilities and their effectiveness. 

Opportunities may also exist to improve some of NRC's recruiting 
processes. For example, it is unclear to what extent NRC managers 
systematically prioritize the positions that need to be filled, 
including the extent to which incentives should be offered to 
prospective employees. Similarly, a cognizant NRC manager told us that 
the agency appeared to dedicate a disproportionate amount of resources 
to recruiting and hiring at the entry level, for which the pool of 
applicants is very robust, as opposed to midlevel and upper-level 
positions, for which candidates generally have had work experience in 
the nuclear power industry--mainly either at nuclear power plants or 
reactor vendors. In addition, most NRC managers expressed concern about 
NRC's future ability to recruit for midlevel and upper-level positions 
when faced with more aggressive industry competition. 

NRC Has Many Training and Development Programs in Place and Is Using 
Flexibilities to Enhance Existing Capacity: 

NRC's training and development activities also represent a key gap 
closure strategy the agency uses. In general, the agency's training and 
development efforts include (1) agencywide, formal technical or 
leadership training and certification programs; (2) external training 
such as enrollment in specialized programs; and (3) on-the-job training 
involving knowledge and skills transfer on particular subjects. NRC 
recently finalized both a knowledge management program and a strategic 
training and development plan to support and sustain its critically 
skilled workforce. In fiscal year 2006, NRC allocated about $9.7 
million for leadership development, training and development, and 
knowledge management activities. Its fiscal year 2007 budget request 
proposed to increase training and development spending to about $15.4 
million, including $4.2 million for new reactor training, $4 million 
for internal technical training, and over $3 million for office- 
specific training. 

Managers we interviewed and surveyed identified NRC's formal training 
and development--such as qualification programs for materials or 
reactor health physics inspectors--and its Nuclear Safety Professional 
Development Program, SES Candidate Development Program, and Leadership 
Potential Program as among the most valuable for training and 
developing personnel. While NRC's Nuclear Safety Professional 
Development Program has been in place and has grown over the past 
several years, the agency also has expanded development opportunities 
for its midlevel and upper-level supervisors and managers, particularly 
in fiscal year 2006. Specifically, NRC facilitated increased, more 
frequent enrollments in both the Leadership Potential Program and its 
counterpart Team Leader Development Program. Because the increase in 
the overall size of NRC's workforce corresponds with the need for 
trained supervisors, managers told us that providing sufficient 
training and development opportunities for new supervisors is vital. 
These managers expressed concern about any potential negative effect of 
excessive workloads on frontline supervisors, many of whom are also new 
to their positions. 

In addition to increasing participation in its development programs, 
NRC is increasing the frequency of key course offerings and focusing on 
particular critical skills areas. For example, in early 2006, OHR and 
NRR evaluated the extent to which training on new reactor designs would 
be required--anticipating future gaps on unique elements related to the 
regulatory process and design technologies--for which the agency has 
initiated specific training courses. Similarly, NRC plans to extend its 
Graduate Fellowship Program, which helps attract a small number of high-
quality, highly educated employees in critical skills areas that the 
agency might not otherwise successfully hire. 

In July 2006, NRC instituted a knowledge management program to 
facilitate the transfer of knowledge and skills on specific subjects. 
The program is intended to systematize NRC's existing structure to 
better support the faster rate of collection, transfer, and use of a 
broader scope of knowledge needed to support, for example, new reactor 
technologies and new reactor designs. The program outlines initiatives 
that serve to avoid significant loss of mission-critical knowledge. NRC 
plans to (1) take over 15 implementing actions to facilitate the 
transfer of knowledge and skills during fiscal years 2006 through 2008 
and (2) allocate over $1 million and several personnel to implement the 
program.[Footnote 26] In general, the managers we interviewed and 
surveyed said the program would be an increasingly valuable tool in the 
coming years. NRC also uses the following specific flexibilities to 
transfer skills and knowledge: 

* NRC has hired replacements for certain positions before the current 
occupants leave the agency. Known as early replacement hiring or double 
encumbering, this flexibility allows NRC to provide salary and benefits 
funding for up to 1 year for the purpose of transferring critical 
skills, competencies, and institutional memory from an employee who is 
planning to leave NRC to a replacement employee. To be effective, early 
replacement hiring requires that the departing employee inform NRC of 
such intentions well in advance of the actual departure date. Since 
2004, NRC's annual funding for early replacement hiring has remained at 
$630,000, and an agency manager estimated that NRC had spent about 
$565,000 for 12 positions in fiscal year 2006. 

* As authorized by the Energy Policy Act of 2005, NRC has waived dual 
compensation limitations, known as the pension offset, for rehired 
retirees receiving pensions. This flexibility, known as the elimination 
of pension offset, allows NRC to rehire a retiree to fill a position at 
full pay if NRC has had difficulty in filling the position or if a 
temporary emergency exists.[Footnote 27] In fiscal year 2006, NRC 
granted waivers for 46 retirees in eight headquarters and regional 
offices and spent about $2.3 million to employ them. The elimination of 
the pension offset is expected to become increasingly valuable to NRC 
in the next few years to retain access to expertise for knowledge 
transfer purposes. 

Also in 2006, NRC completed its agencywide training and development 
strategic plan to support more systematization, definition, and 
integration of its overall training and development approach. The plan 
delineates four goals related to individual performance, training 
effectiveness, training efficiency, and organizational performance. It 
identifies the following actions that NRC plans to take to better 
anticipate staffing, skills, and expertise to improve planning and 
reduce reactive responses: 

* ensure that its intended benefits are realized by using a documented 
and integrated approach; 

* more comprehensively define competencies and training needs for major 
functions or groups of like positions; and: 

* better integrate its training and development programs with 
performance elements and standards, position descriptions, training 
needs surveys, and the SWP system. 

NRC managers generally believe that documenting and enhancing training, 
development, and qualification programs will be essential to enable NRC 
personnel to accomplish NRC's mission effectively and efficiently over 
the next several years. Because determining gap closure frequently 
requires tracking particular skills gaps over a multiyear period, and 
is not always easily demonstrated, NRC could benefit from this more 
systematic approach. 

NRC's Use of Tools, Authorities, and Flexibilities to Retain Critically 
Skilled Employees Varies: 

Nearly all of the managers we interviewed and surveyed said retention 
was not a problem, often citing NRC's 2005 attrition rate of about 6 
percent. As a result, few managers identified retention tools as 
primary gap strategies that NRC most frequently uses to meet existing 
and future skills needs. However, the managers expressed general 
concern about impending retirements and potential future resignations 
if competition with the nuclear power industry intensifies for 
critically skilled employees. 

NRC employs some of the same tools, programs, and flexibilities to 
retain personnel that it uses to hire employees, but their purpose, 
audience, and application vary. For example: 

* NRC managers cited the relocation incentive as a valuable tool in 
retaining NRC personnel, especially inspectors, who move to new 
positions. Overall, 39 employees at the midlevel and upper level 
received a cumulative amount of $638,000 in fiscal year 2006. When 
change-of-station benefits and relocation services are added to this 
amount, relocation outlays totaled approximately $15 million and 
represented the majority of NRC's 2006 human capital budget's Talent 
subcategory. 

* NRC offers retention incentives, although somewhat infrequently. In 
fiscal year 2006, it awarded four, totaling less than $35,000. 

* NRC spent less than $1 million in total for student loan repayments 
for fiscal years 2004 through 2006. Its use of student loan repayments 
as a retention incentive has been relatively steady in recent years and 
has primarily targeted a handful of employees hired into the Honor Law 
Graduate Program. However, some NRC managers believe its use might be 
expanded in the next few years. 

* Most managers we interviewed and surveyed considered telework and 
flexible work schedule arrangements to be very to extremely valuable, 
and would be of the same or increasing value in recruiting, hiring, and 
retaining NRC personnel in the next few years. However, a cognizant NRC 
manager said that managerial and supervisory responsiveness to such 
arrangements varies. NRC does not routinely track or evaluate telework 
participation, such as the number and type of requests approved and 
denied, costs, benefits, and resource requirements associated with the 
program. However, NRC informally surveys offices about the number of 
employees who telework regularly, which is typically considered to be 1 
day per workweek. As of November 2005, when NRC last gathered this 
information, about 250 of NRC's 3,000 employees regularly teleworked. 
In addition, many NRC employees telework on an irregular and infrequent 
basis. 

Although NRC uses and tracks these retention flexibilities to varying 
extents, it has not collected the information on each flexibility's 
costs and benefits needed to assess its effectiveness in retaining 
critically skilled employees while fulfilling management's objectives. 

Some Enhancements of NRC's Infrastructure to Support Administrative, 
Educational, and Other Requirements Are in Process: 

Agencies should build the capability needed to address administrative, 
educational, and other requirements--including information technology, 
security, and adequate space--that are essential to supporting 
infrastructure needs. Our prior work has found that agency officials 
should look for instances to improve process and procedure efficiencies 
and economies to reallocate resources and enable their human capital 
organizations to meet expanded roles in times of growth or change. We 
determined that NRC has taken steps to develop its internal capability 
to support the large number of new employees it expects to hire in 
upcoming years because of retirements and anticipated applications for 
licensing new nuclear reactors. In recent years, NRC has enhanced its 
administrative and information technology and communications support 
processes to improve its infrastructure. However, the agency still 
faces a few key limiting factors that, if left unaddressed or 
unresolved, may adversely affect its ability to meet current and future 
workforce needs. 

To improve its human capital administrative processes related to 
management, NRC has streamlined its recruiting and hiring processes by, 
for example, introducing an automated hiring system, identifying areas 
where it could standardize and streamline its processes, and 
eliminating unnecessary duplication of efforts. Implemented in 2002, 
NRCareers is an automated hiring system that hosts on-line vacancy 
announcements and an online application process. While this system has 
the ability to support an automated rating process and interface with 
such Web sites as USAJOBs, the development of these capacities is still 
in process. In addition, NRC has been (1) working with its personnel 
security branch to streamline the security clearance process for new 
hires and (2) granting clearances under reciprocity required by 
pertinent executive orders. 

NRC also has been creating support systems to improve its management of 
human capital data and reduce inefficiencies. For example, in July 
2005, NRC created the Recruitment Activity Tracking System, a 
centralized Web-based system to monitor candidates' status, including 
when offers are received and for what position, start dates, and 
reasons candidates gave for declining offers. OHR and program office 
managers use this system to monitor vacancy announcements agencywide. 
Because the system records acceptance status, it can enhance 
coordination when NRC offices extend more than one offer to selected 
candidates; although calculating actual offers and acceptances is 
slightly more complex. NRC also uses the Recruitment Activity Tracking 
System to facilitate planning for space, security, resource allocation, 
and information technology by tracking employees' arrival dates. NRC 
plans to expand the system's capacity to track the security clearance 
process and notify OHR managers if candidates exceed a 30-day review 
period. NRC also has taken steps on e-Government initiatives to provide 
consolidated information on employment actions and history, integrating 
payroll and personnel action processing, and human resources line-of- 
business alignment.[Footnote 28] 

To improve its educational infrastructure and internal communication 
process, NRC has developed and is in the process of implementing the 
following three information management systems during fiscal year 2007: 

* NRC is developing an automated system to support its Lessons Learned 
Program--a set of processes, procedures, and oversight designed to 
collectively ensure that significant agency deficiencies are identified 
and corrected so they do not recur. This tool will link two existing 
agency systems to provide a Web-based, searchable and retrievable 
record of how each recommendation is addressed and will support program 
efforts to institutionalize the knowledge gained through the corrective 
action processes and develop solutions for long-term organizational 
retention. 

* NRC is improving the quality and capabilities of its Agencywide 
Document and Access Management System in terms of availability, 
performance, functionality, ease of use, and timeliness. Specifically, 
as a tool to capture knowledge, the Agencywide Document and Access 
Management System could help coordinate the timely review of license 
applications by serving as a complete and easily accessible repository 
of documentation for licensee information, according to NRR managers. 

* By mid-2007, NRC plans to launch the Learning Management System, 
which will replace the current training administration system. The Web- 
based system is designed to facilitate employees' and managers' 
abilities to view training options, plan coursework, and track and 
record progress in qualification programs. The system's original launch 
date, September 2005, was delayed because of compatibility problems 
related to the application and certification and accreditation 
requirements. NRC subsequently postponed its launch to implement an 
updated version of the application that had been developed. OHR 
managers want to link the Learning Management System to the SWP system 
because their efforts to efficiently use training resources have been 
complicated by incompatible information technology systems. 

While these initiatives are under way, NRC faces challenges in building 
the information technology and security infrastructure necessary for 
its increasing workforce. For the past 5 years, NRC's IG has cited the 
protection of information and the implementation of information 
resources as serious management challenges. NRC's Office of Information 
Services--which is responsible for information management, 
architecture, and policies--has taken steps to improve the 
infrastructure by acquiring new systems and integrating existing 
systems. The Office of Information Services also has (1) interfaced 
with NRR and other offices to determine the amount and type of services 
needed for new reactor licensing, (2) recruited and hired additional 
personnel to support the implementation of these new systems, and (3) 
begun to investigate contracting options to complement these new hires. 
However, it is unclear whether these steps will adequately meet the 
challenges associated with NRC's changing demographics and growing 
workforce. For example, NRC managers we interviewed and surveyed said 
telework would be one of the most valuable flexibilities available to 
NRC personnel in future years. However, NRC's information technology 
infrastructure can support only a limited amount of telework and would 
need to be upgraded to provide teleworking employees with secure and 
reliable access to e-mail and agency applications. 

Providing sufficient physical space in which its growing workforce can 
interact is one of NRC's greatest human capital challenges, according 
to its top leadership. In April 2006, NRC requested congressional 
assistance in persuading the General Services Administration and the 
Office of Management and Budget to address its space needs because NRC 
had exhausted the space available in its headquarters building in 
Rockville, Maryland, despite its space optimization program. Among the 
negative effects of inadequate physical space cited by NRC's top 
leadership are the inability to (1) appropriately colocate its new 
personnel with their organizational units to integrate them into the 
organization and provide supervision and (2) provide sufficient 
training and meeting space in headquarters for knowledge transfer and 
training and development purposes. OHR managers told us that training 
classes, in recently acquired space, began in mid-October 2006 after a 
6-month delay. However, it is unclear when NRC will be able resolve its 
long-term space needs because the Office of Management and Budget had 
not authorized the General Services Administration to send its proposal 
for more space to Congress for approval. NRC's top leadership is 
concerned that insufficient space will lead to overcrowding that will 
adversely affect NRC's ability to attract new workers and could lead 
current workers to leave NRC for organizations with a better working 
environment. 

Although NRC Uses Several Human Capital Measures, Some Do Not Provide 
Sufficiently Meaningful Information to Evaluate Progress: 

Our prior human capital work found that agencies need to develop 
appropriate performance measures to link human capital measures with 
strategic goals so they can be used to gauge success and evaluate the 
contribution of human capital activities toward achieving programmatic 
goals. We also found that developing meaningful outcome-oriented 
performance measures for both human capital and programmatic goals, and 
the collection of performance data to measure achievement of these 
goals, are major challenges for many agencies. 

NRC's annual performance planning process, through which its 
performance budget is developed, provides performance measures for each 
goal in its strategic plan.[Footnote 29] Through the performance budget 
process, NRC develops key planning assumptions, program drivers, and 
outputs and establishes output-and outcome-based measures to monitor 
and evaluate program execution. NRC maintains two overall performance 
outcome measures to determine progress toward achieving excellence in 
agency management. To monitor human capital performance, NRC assesses 
progress using six output measures and targets for the recruiting and 
staffing and the training and development categories. 

In assessing NRC's human capital measurement framework, we found the 
following: 

* NRC has collected, tracked, and reported important demographics and 
human capital data and monitored workforce size, shape, and other 
characteristics for at least the past 5 years. OHR maintains a series 
of agencywide strategic workforce planning demographics tables that 
track employees by office and, for example, by their (1) race, 
ethnicity, and gender characteristics; (2) occupations and degree 
levels; (3) years of NRC and federal service; (4) grade or pay level; 
and (5) retirement eligibility and attrition projections and rates. NRC 
uses these data to monitor progress in achieving such human capital 
targets as the number of professional entry-level hires as a percentage 
of total hires. 

* OHR uses around 30 intended outputs, targets, and measures to monitor 
progress in recruitment and staffing, training and development/ 
knowledge management, strategic workforce planning, leadership 
development and succession planning, employee and labor relations, and 
diversity management. OHR categorizes intended outputs in terms of 
effectiveness, timeliness, quality, efficiency, and customer 
satisfaction and compiles the agencywide results on these metrics. 
Program offices also are expected to monitor certain administrative 
metrics, such as the percentage of professional hires at higher grade 
levels, and to report their status to the Executive Director for 
Operations. 

* In fiscal year 2006, NRC met or exceeded most of its human capital 
targets associated with its measures and intended outputs. For example, 
NRC exceeded its target for overall hires of 300 new employees-- 
subsequently increased to 350 new hires--by bringing on 371 employees 
in fiscal year 2006. In addition to these new hires who started by 
September 30, 2006, approximately 145 employees were hired as a result 
of fiscal year 2006 efforts but reported for duty during the first 
quarter of fiscal year 2007. Of these 145 employees, at least 95 are in 
occupational series that are typically considered mission-critical. 

* NRC plans to develop, or is in the process of developing, several 
additional measures, outputs, or metrics to gauge its overall progress 
toward achieving human capital outcomes. These efforts include the 
following: 

- NRC is developing additional output measures for workforce diversity 
and work life services to include in its performance budget during 
fiscal year 2007. NRC also plans to develop measures to annually assess 
program results in knowledge management. 

- NRC continues to explore ways to improve its existing training and 
development performance measures and metrics. For example, NRC is 
refining its training output measures related to tracking the average 
number of training hours completed per person and the percentage of 
personnel who completed a minimum number of training hours. These data 
will provide a baseline to determine appropriate future targets and 
ensure consistency across offices, as appropriate, according to OHR 
managers. These two output measures are among others being or already 
developed to enhance how NRC monitors the extent to which it is 
addressing identified training needs, which is one of its broader 
performance plan measures. 

- NRC plans to refine preliminary employee and labor relations measures 
to improve both the monitoring and evaluation of employee and labor 
relations actions, services provided, or overall performance. In 
particular, a cognizant agency manager told us that measuring the 
timeliness of processing grievances and disciplinary actions, as well 
as services provided, would enhance performance measurement. 

Although NRC met many of its human capital-related targets for fiscal 
year 2006, the agency has not fully implemented an agreed-upon 
framework by, for example, integrating its measures through a human 
capital accountability system plan. According to its 2004 strategic 
human capital plan, NRC intended to develop such a plan to identify the 
measures and associated targets that NRC would use to assess its 
achievement of human capital outcomes. Program office and OHR managers 
we interviewed and surveyed cited the need for an agreed-upon framework 
to improve the effectiveness and appropriateness of specific measures 
and targets. In further commenting on NRC's measurement framework, some 
managers cited the importance of sufficient linkage between the 
successful use of human capital strategies and meeting safety, 
security, openness, and effectiveness goals. The managers believe 
reliability and validity improvements would help NRC evaluate progress 
as its workforce expands and changes. Specifically, they expressed 
concern that while existing agency measures, intended outputs, and 
targets may be used to monitor progress, they do not enable managers to 
fully evaluate associated progress or performance. Without effective 
measures and appropriate targets, it may be more difficult for NRC to 
gauge workforce trends and use them to inform decision making. 

In addition, the managers we interviewed and surveyed had varying 
opinions about specific measures or targets. For example: 

* While NRC exceeded a 75-percent target to retain personnel for a 
minimum of 3 years--reaching over 90 percent--some managers suggested 
that the target should be further examined to determine whether the 3- 
year target correlates with a long-term or career commitment because 
the new generation of workers appears to be less inclined than the 
previous generation to make a longer-term commitment to NRC. 

* NRC also exceeded a target of hiring at least 25 percent of staff at 
the entry level--reaching 34 percent, a target originally put in place 
to reduce the NRC employee's average age, according to officials. 
However, some suggested that NRC consider whether the target is an 
appropriate agencywide measure, or would be better set at the program 
office level, given offices' varied workforce needs. 

* NRC's overall attrition rate of 6.3 percent for fiscal year 2006 was 
higher than its expected 6 percent; the agency lost about 205 staff, 
predominantly to retirement. NRC's projected attrition rates are 6.25 
percent for fiscal year 2008 and 6.5 percent for fiscal year 2009. 
Because NRC slightly underestimated its attrition for fiscal year 2006 
and the attrition rate projection for fiscal year 2008 is lower than 
the actual fiscal year 2006 rate, maintaining these projections may 
underestimate the rate at which attrition may rise as nuclear industry 
competition for skilled employees increases and as older staff members 
retire. As a result, some managers believe that projections should 
incorporate a higher estimated attrition rate. 

* Some managers noted both the usefulness of having, and the difficulty 
in attaining, the OPM target of issuing offer letters within 45 days 
after a vacancy announcement closes. NRC reported it met this target 67 
percent of the time; however, while over 190 offer letters took at most 
45 days, about 65 offer letters took at least 100 days to issue. 
Additionally, one manager stated that the 45-day time frame is too long 
for the competitive environment in which NRC is hiring. 

NRC Is Taking Steps to Address Future Uncertainties That Could 
Adversely Affect Its Overall Workforce Capacity: 

NRC is addressing two key uncertainties affecting its emerging 
workforce needs--how to (1) maintain its workforce in the face of 
future competition with the nuclear power industry for critically 
skilled workers and (2) accurately gauge its workload during the next 3 
years--particularly for reviewing COL applications to construct and 
conditionally operate new reactors. Regarding a likely increase in 
competition with the nuclear industry for critically skilled workers, 
NRC is monitoring the numbers and salaries of scientists and engineers 
in a few key disciplines and working more closely with key university 
programs with the goal of strengthening its candidate pipeline. 
Regarding COL applications, although electric power companies have sent 
letters of intent to NRC, stating that they plan to apply for 20 
licenses to build and operate at least 29 new nuclear power reactors in 
fiscal years 2008 and 2009, it is unclear how many of these projects 
will proceed in the near future. Specifically, NRC expects to receive 8 
applications by December 2007, 10 additional applications by the end of 
September 2008, and 2 more by the end of September 2009; for each COL 
application, almost half of the resources required would be used in its 
first year. To reduce uncertainties and encourage efficiencies related 
to its license review process, NRC has developed a design-centered 
approach to standardize its review of COL applications for new 
reactors. However, changes in the number and timing of application 
submissions will affect NRC's staffing and resource requirements. 

NRC Has Taken Steps to Address Broader Challenges It Faces in 
Sustaining Expertise: 

NRC and the nuclear power industry have raised concerns in recent years 
about a shrinking labor pool of critically skilled individuals in 
several workforce areas required for the research, design, 
construction, operations, and oversight of nuclear reactor and plant 
operations. The nuclear power industry estimated in 2001 that about 
90,000 workers will be needed to support existing industry operations 
through 2011.[Footnote 30] In addition, thousands of employees will be 
needed for the design, licensing, construction, and start-up operations 
of the proposed new reactors. Specifically, the nuclear industry faces 
a potentially critical shortage of workers in several fields over the 
next 5 years.[Footnote 31] 

To keep apprised of industrywide trends and inform its workforce 
assumptions, NRC has contracted with DOE's Oak Ridge Institute for 
Science and Education for over 20 years to gather and evaluate 
occupational, salary, and university enrollment data particularly for 
nuclear engineering and health physics--two mission-critical 
occupations. For example, although university bachelor's and master's 
enrollments and degrees granted in these disciplines have increased 
since 2004, fewer than 700 degrees are granted annually from about 60 
academic programs nationwide,[Footnote 32] which is less than during 
the early to mid-1990s. For nuclear engineering, the institute also has 
reported: 

* Overall national trends have improved in terms of enrollment and 
degrees granted. For example, in 2005 total junior, senior, and 
graduate student enrollments surpassed the 2,000 level for the first 
time since the mid-1990s. However, only about 60 percent of new 
graduates directly enter the U.S. civilian labor force, while the other 
40 percent continue their academic studies, enter active-duty military, 
or take jobs in foreign countries. Furthermore, NRC typically requires 
that applicants be U.S. citizens,[Footnote 33] which further reduces 
the number of graduating candidates eligible for employment, especially 
at advanced degree levels. While a large majority of B.S. degree 
recipients were U.S. citizens, non-U.S. citizens comprised 20 percent 
of master's recipients and 47 percent of Ph.D. recipients in 2005. 

* Because the demand for nuclear engineers is expected to grow faster 
than the supply, upward pressure on starting salaries--which increased 
by only 2 percent in 2004-2005 but by over 5 percent in 2005-2006--will 
continue and provide even more competition to employers in the nuclear 
engineering field. 

For health physicists, the institute has reported: 

* Overall trends have improved in terms of enrollments and degrees 
granted. For example, undergraduate and graduate enrollments were 15 
percent higher than in 2004, and continuing increases are expected. The 
number of health physics-related B.S. degrees granted in 2005 increased 
by over 40 percent from 2004, and at 78 is the highest reported since 
1996; degrees in master's programs increased by 20 percent to 77 
granted, while Ph.D.s granted remained constant. Similar to nuclear 
physics, while a large majority of B.S. degree recipients were U.S. 
citizens, 30 percent of master's and 36 percent of Ph.D. degree 
recipients were non-U.S. citizens. 

* The number of job openings for new graduates will likely continue to 
exceed the number of new graduates available in the labor supply from 
2006 to 2008 and even with increases in enrollments will likely be 
insufficient to substantially reduce projected relative shortages of 
new graduates between 2006 and 2008. The institute noted that more 
health physicists will be retiring over the next few years and many, if 
not most, will have to be replaced, as reflected in a higher number of 
projected job openings. NEI also reported that the general availability 
of health physicists is expected to decline over the next 5 years. 

Because the workforce will likely tighten in several areas before 
current graduation levels produce anywhere near the number of trained 
and educated personnel to meet the likely demand over the next decade, 
NRC has taken the following steps to increase its talent pool: 

* Has planned to spend nearly $5 million in fiscal year 2007 to 
implement its authority under the Energy Policy Act of 2005 to award, 
in grants to universities and colleges, support for educational 
programs that will benefit its safety, security, and environmental 
responsibilities. During fiscal year 2006, training and development 
program managers worked to develop criteria for identifying educational 
programs for which investments will most likely expand expertise in 
critical skills areas. Implementation of this grants-to-universities 
program is targeted for fiscal year 2007. 

* Budgeted $225,000 in fiscal year 2006 and proposed $375,000 in fiscal 
year 2007 to offer scholarships and fellowships in critical skills 
areas. 

* Budgeted $125,000 in fiscal year 2006 and proposed $140,000 in fiscal 
year 2007 for student transportation and lodging expenses while on 
temporary assignment to NRC, which managers told us was particularly 
useful in attracting candidates. 

* Integrated and enhanced existing programs to create a program for 
Minority Serving Institutions--historically black colleges and 
universities, Hispanic serving institutions, and tribal colleges and 
universities--that provides financial assistance to programs and such 
activities as mentoring, training, research and development, 
cooperative agreements, fellowships, internships, and scholarships. In 
August 2006, NRC announced plans to link this program with its 
recruiting program and develop relationships with recipients of its 
financial assistance to (1) encourage the development of skills and 
research critical to the agency, (2) provide access to educational and 
career development opportunities, and (3) increase the diversity of the 
job applicant pool. 

While NRC has taken these steps, and the nuclear power industry is 
similarly making or continuing efforts to partner with educational 
institutions to develop workers or augment their existing training 
programs, enhancing the talent pool may require additional approaches. 
Besides health physics and nuclear engineering, many of the over 300 
vacancies--for which NRC posted over 60 position descriptions in 
several occupational series in fiscal year 2006--require specialized 
knowledge, skills, and experience that will likely continue to be hard 
to fill or in high demand. These include, but are not limited to, areas 
such as project management, reliability and risk analysis, and digital 
instrumentation and control. Quicker and more focused training options 
include intensifying the amount of course detail and/or increasing 
certification or specialization requirements, and further developing 
and executing strategies that capture and transfer the significant 
knowledge of aging workers. 

NRC Has Taken Several Steps to Prepare for New Reactor Licensing, but 
the Combined License Review Process Is Untested: 

A number of activities that NRC has undertaken to prepare to review COL 
license applications to construct and conditionally operate new 
reactors are in various stages of completion. These NRC activities 
include (1) initiating its Construction Inspection Program; (2) moving 
forward on design certifications and early site permit activities; (3) 
continuing and finalizing the development of regulatory guidance, 
rulemaking, and standard review plan materials addressing the contents 
of a COL application. NRC also has developed initial estimates of the 
resources needed to review new reactor license applications. As of 
August 2006, when the Commission approved the creation of the Office of 
New Reactors, fewer than 100 employees were working either part-or full-
time on new reactor licensing and preparatory activities. NRC is in the 
process of staffing the Office of New Reactors with the targeted number 
of employees scheduled to more than double from 230 in late January 
2007 to over 480 in October 2007.[Footnote 34] (See app. IV for 
information on NRC's recent reorganization efforts.) In addition, NRC 
has estimated the following regarding new reactor licensing work: 

* NRC employees will perform about two-thirds and contractors will 
perform about one-third of the COL review work. In August 2006, NRC 
reported that about $60 million for contracted expertise would be 
required in fiscal year 2008 to acquire the expertise of individuals 
who have (1) very specialized skills that NRC personnel do not possess 
and that is not cost-effective to add full time or (2) general 
engineering expertise that NRC personnel possess in insufficient 
numbers. 

* Given that nearly all applications are expected to be submitted in 
fiscal year 2008, licensing resource needs for new reactors would 
remain the same or increase slightly in fiscal year 2009, depending on 
whether NRC receives more applications, and on their timing and number. 
Industry has advised NRC of the possibility that higher than the 
planned number of applications--20 as of November 2006--may eventually 
be submitted. 

To integrate planned and ongoing activities, NRC is also developing a 
master schedule/project management plan that is to match activities to 
personnel with appropriate skills to scheduled completion dates; NRC 
estimated the plan's completion date is early 2007. In addition, in the 
event that the agency's recruiting goals are not met, NRC is developing 
a procurement contingency plan. This plan would enable NRC to acquire 
technical review support from a broad spectrum of organizations. NRC 
anticipates that the upcoming increase in contracting demand for a 
diverse range of skill sets needs may exceed the capabilities or supply 
of any given source. Also, NRC reported that DOE's Office of Science 
laboratories are establishing a team to assist NRC in identifying 
needed technical resources and management skills. 

NRC also has focused its new reactor licensing efforts on delineating 
its standardized design-centered review approach. NRC expects this 
approach will improve the efficiency of its review of COL applications 
by reducing the review time to at most 42 months, including holding 
required public hearings. NRC could not fully base its estimates on 
recent experience or historical data because its review process has yet 
to be tested. However, NRC did evaluate the resource requirements for 
the first three early site permit applications it received in 2003 to 
inform its COL application estimates.[Footnote 35] NRC's review of each 
early site permit took more time and effort than either NRC or the 
applicants expected. NRC managers told us that the agency learned from 
this initial experience and expects future early site permit reviews to 
go more smoothly. They expect a similar learning curve with the first 
group of COL reviews, noting that estimates of the personnel needed to 
review COL applications may thus be subject to some adjustment. In 
addition, because this first group could be large--10 applications are 
expected in the first 6 months of fiscal year 2008, and 8 are expected 
in the second 6 months--any challenges, if not fully resolved, could be 
exacerbated. 

The COL application process is new for the electric power companies as 
well. NRC's staffing and resource estimates are based on 
standardization and consistency and complete, high-quality 
applications. To this end, NRC has established reactor design-based 
working groups with industry to facilitate communication and 
interaction about all aspects of the application process, including 
lessons learned on most recent construction activities as well as 
financing, hardware, supply, and other infrastructure issues. 
Nevertheless, the agency will not know how effective these activities 
have been until applications are submitted--NRC expects the first COL 
applications to be submitted in October 2007. In addition, determining 
the sufficiency of additional information NRC requests from a licensee 
may require both significant analytical expertise and review by the 
agency, and timeliness on the part of the applicant. Furthermore, any 
delays in the completion of technical review plans or lack of clarity 
in regulatory guidance could make it more difficult for companies to 
ensure the adequacy of their submissions.[Footnote 36] 

The timing of COL application submissions could also adversely 
influence the intended effectiveness of NRC's design-centered review 
approach. Although NRC documents state that the optimal implementation 
of the approach is to first have a completed design certification, many 
activities will likely occur simultaneously or near-simultaneously. 
Standardization is key to NRC's approach, as applicants are expected to 
submit standard applications that use reactor designs that have been 
certified. This suggests that NRC would certify a reactor design before 
it reviews COL applications that refer to that design. That is not the 
case, however, for 8 of the 20 COL applications NRC expects to receive 
because (1) applicants plan to submit 3 COL applications about halfway 
through NRC's certification of the associated design and (2) NRC 
expects to review 5 other COL applications nearly simultaneously with 
its certification of the design.[Footnote 37] 

Similarly, an important component of NRC's approach is the use of a 
"reference application." According to NRC managers and NEI executives, 
around 70 percent of additional application contents are intended to be 
virtually identical to the reference application. NRC assumes it will 
realize FTE/resource savings of 50 percent on the safety reviews of 
applications consistent with the reference application. However, it is 
unclear whether the use of reference applications will actually save 
NRC review time when they are reviewed concurrently with others. In 
essence, NRC will conduct multiple, nearly simultaneous application 
reviews for all designs that companies currently intend to use. For 
example, NRC expects the reference application and three applications 
for the same design to arrive in the same fiscal quarter. Ultimately, 
because of these compressed time frames, the efficient and effective 
allocation of resources and adherence to schedules is paramount. 

Conclusions: 

In recent years, NRC's human capital management has been generally 
effective in comparison with its federal government counterparts. 
Nevertheless, NRC faces a considerable challenge in addressing 
workforce retirements and anticipated significant additional work 
beginning in October 2007, as electric power companies submit 
applications for licenses to construct and operate the next generation 
of nuclear power reactors. Through its strategic human capital planning 
and management framework, NRC has taken several important steps to 
enhance its overall workforce capacity; however, some new and in- 
progress efforts have not yet been tested. It is unclear how the 
confluence of increasing regulatory workload demands, maintaining 
existing focus on safety and security activities, rising numbers of 
retirement-eligible employees and other demographic shifts, and 
anticipated industry competition for critically skilled workers will 
ultimately influence NRC's generally positive workforce trends and 
successes. These challenges require a considerable level of 
flexibility, staff commitment, and successful strategic human capital 
management for NRC to be able to appropriately adapt to shifting human 
capital needs. If overall workforce and resource allocations are not 
balanced, NRC risks overextending its available workforce, undermining 
its employee satisfaction, and potentially increasing its attrition. If 
so, reviewing license applications and conducting other mission- 
critical activities within estimated time frames could become more 
difficult and could adversely affect NRC's ability to ensure a safe and 
secure nuclear power industry. Furthermore, substantial delays in the 
license application process could adversely affect investor confidence, 
decrease the likelihood of nuclear energy generation being cost 
beneficial, and possibly reduce the amount of electricity available to 
the U.S. market. 

Recommendations for Executive Action: 

To improve NRC's ability to meet its current and future needs for a 
critically skilled workforce, we are recommending that NRC take the 
following four actions: 

* Promote the coordination and integration of human capital planning 
and implementation activities by completing the agencywide human 
capital implementation plan; ensuring that the Human Capital Council 
provides strategic direction, advice, and recommendations on addressing 
human capital issues; and providing the appropriate level of resources 
to implement knowledge management program and strategic training and 
development plan. 

* Systematically assess the effectiveness of NRC's use of tools, 
authorities, and flexibilities for recruiting, developing, and 
retaining its workforce and adjust their use and targeting, as 
necessary, to meet workforce needs. 

* Periodically and comprehensively evaluate and share information among 
NRC's offices on the usefulness of human capital measures, intended 
outputs, and targets to enhance NRC's ability to monitor trends, 
reliably measure progress, and inform program office managers in 
achieving critical human capital tasks. 

* Survey employees during fiscal year 2007 on their satisfaction with 
NRC's human capital program, including new initiatives and offices' use 
of flexibilities to maintain a quality work environment. 

Agency Comments: 

We provided NRC with a draft of this report for its review and comment. 
In written comments, NRC generally agreed with the report's findings, 
conclusions, and recommendations, stating that they are very 
constructive. NRC also noted, however, that the circumstances 
underlying the report have changed because Congressional leaders have 
announced their intent to extend the Continuing Appropriations 
Resolution, 2007, for the full fiscal year, with few exceptions. 
According to NRC, the funding in the Continuing Resolution--which 
extends the fiscal year 2006 appropriation amount to fiscal year 2007-
-would result in a $95 million reduction in the level of funding that 
NRC had expected compared with the level approved by the full House of 
Representatives and the Senate Committee on Appropriations for fiscal 
year 2007. NRC states that the funding and FTE restrictions under a 
full-year Continuing Resolution at the fiscal year 2006 level would 
have a crippling effect on its ability to manage human capital, citing 
as an example that NRC would significantly curtail--and possibly cease-
-new hiring, except for those already given offers and those necessary 
for the most critical of skills. (See app. VI.) In addition, NRC 
provided comments to improve the report's technical accuracy, which we 
have incorporated as appropriate. 

We are sending copies of this report to interested congressional 
committees, the Chairman of NRC, the Director of the Office of 
Management and Budget, and other interested parties. We will also make 
copies available to others upon request. In addition, the report will 
be available at no charge on the GAO Web site at [Hyperlink, 
http://www.gao.gov]. 

If you or your staffs have questions about this report, please contact 
me at (202) 512-3841 or wellsj@gao.gov. Contact points for our Offices 
of Congressional Relations and Public Affairs may be found on the last 
page of this report. GAO staff who made major contributions to this 
report are listed in appendix VII. 

Signed by: 

Jim Wells: 
Director, Natural Resources and Environment: 

[End of section] 

Appendix I: NRC's Changing Workforce Demographics: 

The demographics of NRC's workforce will substantially change in the 
next few years for two reasons. First, the percentage of employees 
eligible to retire is expected to grow from the current level of about 
16 percent to about 33 percent of the workforce in fiscal year 2010. 
Second, NRC projects that its workforce size will need to grow from 
about 3,100 employees in early fiscal year 2006 to nearly 4,000 
employees by 2010 to meet the significant anticipated upsurge in 
workload demands as NRC begins to review power company applications for 
permits to construct and operate new nuclear reactors. The following 
tables present information on NRC's changing workforce demographics. 

Table 2: Comparison of Selected NRC Workforce Demographics, Fiscal 
Years 2002 through 2006: 

Demographic: Total employees; 
As of 9/30/2002: 2,928; 
As of 10/2/2004: 3,110; 
As of 9/30/2006: 3,347. 

Selected offices; 

Demographic: Office of Nuclear Reactor Regulation; 
As of 9/30/2002: 591 (20%); 
As of 10/2/2004: 593 (19%); 
As of 9/30/2006: 739 (22%). 

Demographic: Office of Nuclear Security and Incident Response; 
As of 9/ 30/2002: 105 (4); 
As of 10/2/2004: 187 (6); 
As of 9/30/2006: 216 (6). 

Demographic: Office of Administration; 
As of 9/30/2002: 98 (3); 
As of 10/2/2004: 98 (3); 
As of 9/30/2006: 123 (4). 

Demographic: Office of Nuclear Materials Safety and Safeguards; 
As of 9/30/2002: 332 (11); 
As of 10/2/2004: 334 (11); 
As of 9/30/2006: 334 (10). 

Demographic: Office of Nuclear Regulatory Research; 
As of 9/30/2002: 208 (7); 
As of 10/2/2004: 217 (7); 
As of 9/30/2006: 225 (7). 

Employees by age. 

Demographic: Average age; 
As of 9/30/2002: 47.83; 
As of 10/2/2004: 47.91; 
As of 9/30/2006: 47.60. 

Demographic: Under 40; 
As of 9/30/2002: 576 (20%); 
As of 10/2/2004: 631 (20%); 
As of 9/30/2006: 745 (22%). 

Demographic: of which 29 and under; 
As of 9/30/2002: 164 (6); 
As of 10/ 2/2004: 225 (7); 
As of 9/30/2006: 313 (9). 

Demographic: 40 to 49; 
As of 9/30/2002: 982 (34); 
As of 10/2/2004: 1002 (32); 
As of 9/30/2006: 1,016 (30). 

Demographic: 50 to 60+; 
As of 9/30/2002: 1370 (47); 
As of 10/2/2004: 1477 (47); 
As of 9/30/2006: 1,586 (47). 

Employees by NRC service years. 

Demographic: Average years; 
As of 9/30/2002: 13.65; 
As of 10/2/2004: 13.16; 
As of 9/30/2006: 12.29. 

Demographic: 0 to 5 years; 
As of 9/30/2002: 747 (26%); 
As of 10/2/2004: 1,013 (33%); 
As of 9/30/2006: 1,311 (39%). 

Demographic: 6 to 10 years; 
As of 9/30/2002: 274 (9%); 
As of 10/2/2004: 265 (9%); 
As of 9/30/2006: 371 (11%). 

Demographic: 11 to 20 years; 
As of 9/30/2002: 1059 (36%); 
As of 10/2/ 2004: 983 (32%); 
As of 9/30/2006: 802 (24%). 

Demographic: 21 or more years; 
As of 9/30/2002: 848 (29%); 
As of 10/2/ 2004: 849 (27%); 
As of 9/30/2006: 863 (26%). 

Employees by federal service years. 

Demographic: Average years; 
As of 9/30/2002: 17.88; 
As of 10/2/2004: 17.27; 
As of 9/30/2006: 16.21. 

Demographic: 0 to 5 years; 
As of 9/30/2002: 438 (15%); 
As of 10/2/2004: 655 (21%); 
As of 9/30/2006: 895 (27%). 

Demographic: 6 to 10 years; 
As of 9/30/2002: 258 (9); 
As of 10/2/2004: 266 (9); 
As of 9/30/2006: 334 (10). 

Demographic: 11 to 20 years; 
As of 9/30/2002: 937 (32); 
As of 10/2/ 2004: 883 (28); 
As of 9/30/2006: 801 (24). 

Demographic: 21 or more years; 
As of 9/30/2002: 1,295 (44); 
As of 10/2/ 2004: 1,212 (39); 
As of 9/30/2006: 1,218 (36). 

Employees: Science and engineering occupational series (percentage of 
agency total). 

Demographic: Nuclear Engineering; 
As of 9/30/2002: 14%; 
As of 10/2/ 2004: 13%; 
As of 9/30/2006: 12%. 

Demographic: Other Engineering; 
As of 9/30/2002: 29; 
As of 10/2/2004: 31; 
As of 9/30/2006: 34. 

Demographic: Health Physics; 
As of 9/30/2002: 7; 
As of 10/2/2004: 6; 
As of 9/30/2006: 6. 

Demographic: Other Physical Science; 
As of 9/30/2002: 5; 
As of 10/2/ 2004: 6; 
As of 9/30/2006: 6. 

Employees: Engineers, scientists, technical managers, and supervisors 
(percentage of office total). 

Demographic: Office of Nuclear Reactor Regulation; 
As of 9/30/2002: 80%; 
As of 10/2/2004: 81%; 
As of 9/30/2006: 82%. 

Demographic: Office of Nuclear Security and Incident Response; 
As of 9/ 30/2002: 54; 
As of 10/2/2004: 55; 
As of 9/30/2006: 48. 

Demographic: Office of Nuclear Materials Safety and Safeguards; 
As of 9/30/2002: 78; 
As of 10/2/2004: 77; 
As of 9/30/2006: 79. 

Demographic: Office of Nuclear Regulatory Research;
As of 9/30/2002: 77; 
As of 10/2/2004: 78; 
As of 9/30/2006: 80. 

Demographic: Region I; 
As of 9/30/2002: 73; 
As of 10/2/2004: 76; 
As of 9/30/2006: 75. 

Demographic: Region II; 
As of 9/30/2002: 67; 
As of 10/2/2004: 67; 
As of 9/30/2006: 68. 

Demographic: Region III; 
As of 9/30/2002: 68; 
As of 10/2/2004: 71; 
As of 9/30/2006: 73. 

Demographic: Region IV; 
As of 9/30/2002: 69; 
As of 10/2/2004: 72; 
As of 9/30/2006: 73. 

Employees by pay level (percentage of agency total). 

Demographic: Senior level; 
As of 9/30/2002: 8%; 
As of 10/2/2004: 8%; 
As of 9/30/2006: 7%. 

Demographic: GG-15; 
As of 9/30/2002: 23; 
As of 10/2/2004: 25; 
As of 9/ 30/2006: 25. 

Demographic: GG-14; 
As of 9/30/2002: 25; 
As of 10/2/2004: 25; 
As of 9/ 30/2006: 24. 

Demographic: GG-13; 
As of 9/30/2002: 18; 
As of 10/2/2004: 18; 
As of 9/ 30/2006: 20. 

Demographic: GG-12 to 8; 
As of 9/30/2002: 16; 
As of 10/2/2004: 17; 
As of 9/30/2006: 16. 

Demographic: GG-7 to 2; 
As of 9/30/2002: 10; 
As of 10/2/2004: 8; 
As of 9/30/2006: 7. 

Entry-level hire ratio. 

Demographic: Agencywide; 
As of 9/30/2002: 41%; 
As of 10/2/2004: 25%; 
As of 9/30/2006: 34%. 

Demographic: Office of Nuclear Reactor Regulation; 
As of 9/30/2002: 40; 
As of 10/2/2004: 41; 
As of 9/30/2006: 34. 

Demographic: Office of Nuclear Security and Incident Response; 
As of 9/ 30/2002: 18; 
As of 10/2/2004: 12; 
As of 9/30/2006: 13. 

Demographic: Office of Nuclear Materials Safety and Safeguards; 
As of 9/30/2002: 75; 
As of 10/2/2004: 29; 
As of 9/30/2006: 23. 

Demographic: Office of Nuclear Regulatory Research; 
As of 9/30/2002: 65; 
As of 10/2/2004: 27; 
As of 9/30/2006: 60. 

Demographic: Region I; 
As of 9/30/2002: 30; 
As of 10/2/2004: 19; 
As of 9/30/2006: 50. 

Demographic: Region II; 
As of 9/30/2002: 55; 
As of 10/2/2004: 42; 
As of 9/30/2006: 36. 

Demographic: Region III; 
As of 9/30/2002: 33; 
As of 10/2/2004: 13; 
As of 9/30/2006: 38. 

Demographic: Region IV; 
As of 9/30/2002: 20; 
As of 10/2/2004: 45; 
As of 9/30/2006: 45. 

Source: NRC. 

Note: Percentages may not add to 100 percent due to rounding. 

[End of table] 

Table 3: Percentage of the NRC Workforce that Is Eligible to Retire, 
Fiscal Years 2002 through 2011: 

Optional retirement eligibility: Fiscal year 2002; 
As of 9/30/2002: 15%; 
As of 10/2/2004: ; 
As of 9/30/2006: . 

Optional retirement eligibility: Fiscal year 2003; 
As of 9/30/2002: 19; 
As of 10/2/2004: ; 
As of 9/30/2006: . 

Optional retirement eligibility: Fiscal year 2004; 
As of 9/30/2002: 23; 
As of 10/2/2004: 16%; 
As of 9/30/2006: . 

Optional retirement eligibility: Fiscal year 2005; 
As of 9/30/2002: 27; 
As of 10/2/2004: 20; 
As of 9/30/2006: . 

Optional retirement eligibility: Fiscal year 2006; 
As of 9/30/2002: 31; 
As of 10/2/2004: 23; 
As of 9/30/2006: 16%. 

Optional retirement eligibility: Fiscal year 2007; 
As of 9/30/2002: 36; 
As of 10/2/2004: 28; 
As of 9/30/2006: 21. 

Optional retirement eligibility: Fiscal year 2008; 
As of 9/30/2002: ; 
As of 10/2/2004: 32; 
As of 9/30/2006: 24. 

Optional retirement eligibility: Fiscal year 2009; 
As of 9/30/2002: ; 
As of 10/2/2004: 37; 
As of 9/30/2006: 29. 

Optional retirement eligibility: Fiscal year 2010; 
As of 9/30/2002: ; 
As of 10/2/2004: ; 
As of 9/30/2006: 33. 

Optional retirement eligibility: Fiscal year 2011; 
As of 9/30/2002: ; 
As of 10/2/2004: ; 
As of 9/30/2006: 37. 

Source: NRC. 

Note: Actual percentages of NRC's workforce eligible to retire are 
shown for 2002 through 2006. Estimated percentages of NRC's workforce 
eligible to retire are shown for 2007 through 2011. 

[End of table] 

Table 4: Employees Who Left NRC, Fiscal Years 2002 through 2006: 

Permanent attrition: Fiscal year 2002; 
Number: 146; 
Percent[A]: 5.1. 

Permanent attrition: Fiscal year 2003; 
Number: 149; 
Percent[A]: 5.0. 

Permanent attrition: Fiscal year 2004; 
Number: 161; 
Percent[A]: 5.1. 

Permanent attrition: Fiscal year 2005; 
Number: 189; 
Percent[A]: 6.0. 

Permanent attrition: Fiscal year 2006;
Number: 205; 
Percent[A]: 6.3. 

Source: NRC. 

[A] Attrition percentages are annualized. 

[End of table] 

[End of section] 

Appendix II: Scope and Methodology: 

To assess the extent to which the Nuclear Regulatory Commission (NRC) 
has aligned its human capital planning framework with its strategic 
mission and programmatic goals, we analyzed a broad range of NRC 
policy, planning, and implementation documents and reviewed key 
performance budget and performance and accountability documents and 
reports. Specifically, we examined information on NRC's operations and 
strategic planning efforts, including agencywide strategic plans and 
program documents, operating and human capital management plans, 
management directives, select internal analyses and communications of 
human resources personnel, Human Capital Council and Communications 
Council meeting minutes, and the NRC Inspector General's Safety Culture 
and Climate Survey results for 1998, 2002, and 2005. 

We corroborated information provided in these documents in interviews 
with human resources managers in NRC's headquarters and regional 
offices. We also interviewed cognizant managers in NRC's Office of 
Human Resources (OHR); program offices including Nuclear Reactor 
Regulation (NRR), Nuclear Regulatory Research, Nuclear Materials Safety 
and Safeguards, and Nuclear Security and Incident Response; and NRC's 
four regional offices--region I in King of Prussia, Pennsylvania; 
region II in Atlanta, Georgia; region III in Lisle, Illinois; and 
region IV in Arlington, Texas. We visited regions I and II as well as 
NRC's Technical Training Center in Chattanooga, Tennessee. 

To assess the extent to which NRC is effectively recruiting, 
developing, and retaining critically skilled personnel, we applied the 
five strategic workforce planning principles presented in our March 
2002 exposure draft on a model for strategic human capital management 
and in our December 2003 report on key principles for effective 
strategic workforce planning. (See the Related GAO Reports section at 
the end of this report for a list of previous reports that we have 
issued on NRC and strategic workforce planning and human capital 
management.) We also reviewed the Office of Personnel Management's 
(OPM) Human Capital Assessment and Accountability Framework and related 
guidance. In doing so, we analyzed NRC's (1) workforce and demographics 
data; (2) critical skills information, including needs and gap 
assessments; (3) implementation of its recruiting, hiring, training and 
development, and retention strategies and plans; (4) implementation of 
new systems, programs, and processes that support human capital 
management and planning; and (5) measures of its progress and results. 
In addition, we analyzed NRC's reorganization plans, program plans, and 
human capital budget and flexibilities data. Furthermore, OHR and 
technical training center personnel provided demonstrations on the 
Strategic Workforce Planning system database and Recruitment Activity 
Tracking System. 

We also examined data obtained from the Federal Personnel Payroll 
System, NRC's Human Resource Management System, and NRC's Recruitment 
Activity Tracking System. In addition, we obtained budget and outlay 
data from NRC's Chief Financial Officer and OHR. To assess the 
reliability of the data needed to answer the engagement objectives, we 
checked these data for obvious errors in accuracy and completeness, 
reviewed existing information about these data and the system that 
produced them, and interviewed agency officials knowledgeable about 
these data. We determined that these data were sufficiently reliable 
for the purposes of this report. 

To gain more insight into NRC's use of human capital flexibilities, 
authorities, tools, measures, and targets, we surveyed 45 Senior 
Executive Service and GG-15 level managers in 11 NRC offices, including 
OHR, technical program offices, and regional offices who represent 
strategic human management and leadership in offices with large 
components of critically skilled personnel. We obtained responses from 
32 of 45 NRC managers, a response rate of 71 percent. The questionnaire 
asked respondents to rate the value of human capital flexibilities, 
authorities, tools, and programs that NRC uses in hiring, developing, 
and retaining personnel, and their value in the future. We also asked 
the managers to rate the effectiveness and appropriateness of measures 
and metrics in monitoring and evaluating progress in achieving 
programmatic goals at the agencywide and office levels. 

The practical difficulties of conducting any survey may introduce 
certain types of errors, commonly referred to as "nonsampling errors." 
For example, differences in how a particular question is interpreted, 
the sources of information available to respondents, or the types of 
people who do not respond can introduce unwanted variability into 
survey results. To reduce nonsampling errors, we conducted four 
pretests with respondents to ensure that questions and response 
categories were interpreted in a consistent manner and revised the 
instruments on the basis of the pretest results. 

To assess the extent to which NRC is taking steps to address future 
uncertainties that could adversely affect its overall workforce 
capacity, we examined (1) the existing and future engineering, science, 
and technology labor pool and (2)