This is the accessible text file for GAO report number GAO-05-118R 
entitled 'Securities and Exchange Commission Human Capital Survey' 
which was released on November 10, 2004.

This text file was formatted by the U.S. Government Accountability 
Office (GAO) to be accessible to users with visual impairments, as part 
of a longer term project to improve GAO products' accessibility. Every 
attempt has been made to maintain the structural and data integrity of 
the original printed product. Accessibility features, such as text 
descriptions of tables, consecutively numbered footnotes placed at the 
end of the file, and the text of agency comment letters, are provided 
but may not exactly duplicate the presentation or format of the printed 
version. The portable document format (PDF) file is an exact electronic 
replica of the printed version. We welcome your feedback. Please E-mail 
your comments regarding the contents or accessibility features of this 
document to

This is a work of the U.S. government and is not subject to copyright 
protection in the United States. It may be reproduced and distributed 
in its entirety without further permission from GAO. Because this work 
may contain copyrighted images or other material, permission from the 
copyright holder may be necessary if you wish to reproduce this 
material separately.

United States Government Accountability Office:

Washington, DC 20548:

November 10, 2004:

The Honorable William H. Donaldson:
Securities and Exchange Commission:

450 Fifth Street, N.W.
Washington, D.C. 20549:

Subject: Securities and Exchange Commission Human Capital Survey:

Dear Chairman Donaldson:

This document presents the results of a recent GAO survey of human 
capital issues at the Securities and Exchange Commission (SEC). In 
March and April 2004, we conducted a follow-up to our 2001 human 
capital survey of SEC attorneys, accountants, and examiners to 
benchmark their views after the agency had implemented pay parity and 
work-life programs.[Footnote 1] 2001 SEC survey respondents were 
overwhelmingly dissatisfied with pay and identified other nonpay issues 
as warranting SEC management's attention. The 2004 survey generally 
covered the same issue areas that we addressed in the 2001 survey, 
including (1) compensation, (2) overall job satisfaction, (3) work-life 
balance, (4) supervision and management, (5) performance appraisal and 
incentive system, (6) opportunities for advancement, (7) organizational 
structure and support, (8) communication within divisions and offices, 
and (9) training.

As shown in enclosure I, compared to the 2001 SEC survey respondents, 
the 2004 respondents were significantly more satisfied with their pay 
and their ability to use flexitime and flexiplace.[Footnote 2] The 
improvement in employee satisfaction with compensation and worklife 
programs could be attributed to SEC's recent implementation of pay 
parity[Footnote 3] and increased focus on implementing work-life 
programs.[Footnote 4] In addition, overall the employees remained 
satisfied with their jobs and the meaningfulness of their work. While 
employee satisfaction has improved with respect to compensation and 
worklife programs, the levels of satisfaction have decreased in three 
nonpay categories. Specifically, employees were less satisfied with (1) 
the quality of supervision provided by their immediate supervisor and 
(2) the extent to which management communicates, in a timely manner, 
information that affects their work and the guidance they receive from 
management on their work priorities, and they were more dissatisfied 
with (3) the ability of SEC's performance appraisal system to motivate 
employees to perform well and the consistency with which the system is 
applied[Footnote 5]. These areas, which were previously mentioned in 
our 2001 report as warranting management attention, appear to be areas 
SEC should continue to address.[Footnote 6]

To conduct the 2004 survey, we randomly selected a sample of 531 SEC 
attorneys, accountants, and examiners from the same target population 
positions, excluding staff hired in the last 3 years, in order to 
obtain more accurate comparisons between the 2001 and 2004 survey data. 
We implemented the survey using a self-administered electronic 
questionnaire that was posted on the World Wide Web. To ensure security 
and the integrity of our data, we provided each contact person with a 
password for accessing and completing the survey. From the sample of 
531, we received 388 usable responses, for an overall response rate of 
73 percent. Enclosure II provides a more detailed discussion of our 
methodology. We conducted our survey work in accordance with generally 
accepted government auditing standards.

If you have any questions about the survey results or our methodology, 
please feel free to contact me at 202-512-8678 or, or 
Karen Tremba, Assistant Director, at 202-512-3113 or 
Other GAO staff that made key contributions to this report are Allison 
Abrams, Thomas Beall, William R. Chatlos, and Joe Hunter.

Sincerely yours,

Signed by: 

Richard J. Hillman:


Financial Markets and Community Investment:

Enclosures - 2:

Enclosure I: Survey of Securities and Exchange Commission Employees: 

[See PDF for images]

[End of survey]

[End of section]

Enclosure II: Methodology for GAO's Survey of Securities and Exchange 
Commission Employees:

The primary objective of this study was to assess the current views of 
employees at the Securities and Exchange Commission (SEC) on selected 
human capital issues related to employment at SEC and to compare these 
views with those of a similar cadre of employees that GAO surveyed in 
2001.[Footnote 7] In the time between the two surveys, SEC had 
implemented pay parity and work-life programs. A follow-up survey to 
the 2001 survey presented a method for detecting if the perceptions of 
employees subsequent to these changes had also shifted. To meet this 
objective, we conducted a survey of a statistically representative 
sample of 531 SEC attorneys, accountants, and examiners employed as of 
September 30, 2003. The survey was conducted using a self-administered 
electronic questionnaire posted on the World Wide Web during March and 
April 2004. At the close of the survey, we had received 388 completed, 
usable surveys.

Sample Design:

In order to maintain comparability between the responses to the two 
surveys, the study population for the 2004 survey was the same as that 
used for the 2001 survey. As with the 2001 survey, we defined our 
population of interest to be employees in the attorney, accountant, and 
examiner positions (Series 0905, 0510, and 1831). We also followed 
survey procedures that were analogous to the prior survey. We asked SEC 
to provide a list of its attorneys, accountants, and examiners from its 
personnel data system as of September 30, 2003. However, to further 
ensure that we defined the population as one that was comparable to the 
one surveyed in 2001, we further adjusted the population by excluding 
648 recent hires into these positions over the last 3 years, that is, 
the period subsequent to the prior survey. The final study population 
was 1,653 SEC employees.

We used a stratified, systematic random sample of SEC employees from 
the study population. The population was divided into two strata. The 
first stratum was employees from any regional or district office, and 
the second stratum was employees from the Washington, D.C./Metro 
Office. Of the 1,653 employees in our study population, there were 810 
in the first stratum and 843 in the second stratum. We selected a total 
sample of 531 employees--264 from the first stratum and 267 from the 
second stratum.

Survey Development:

Almost all of the survey questions asked in the 2004 survey were the 
same as the questions asked in the 2001 survey. The 2004 questionnaire 
consisted of approximately 55 items, almost all of which were closed-
ended--that is respondents were to choose a specific response category 
that reflected their level of satisfaction or dissatisfaction with 
various aspects of work. We used a 5-point scale with the following 
response categories: very satisfied, generally satisfied, neither 
satisfied nor dissatisfied, generally dissatisfied, very dissatisfied. 
There were also items that obtained demographic information about the 
respondents. A representation of the Survey of Securities and Exchange 
Commission Employees can be seen in enclosure I.

Not all of the questions asked on the 2001 survey were asked on the 
2004 survey. Because the objective of the 2004 survey was to assess 
perceived changes in the work environment, we retained most of the 
items from the 2001 survey asking about various aspects of work. We 
excluded sections from the 2001 survey that asked why employees 
initially decided to work at SEC and that asked about the perceived 
impact of factors on morale, future plans and reasons for leaving SEC. 
Because almost all items of the 2004 survey were pretested when used in 
the 2001 survey, no additional pretesting was conducted.

As with the 2001 survey, we presented the draft questionnaire to SEC 
officials for comments and received only minor changes. We also asked 
union officials representing SEC employees to review a draft version of 
the survey.

Survey Administration:

Beginning March 4, 2004, the sampled SEC staff were sent e-mail 
notifications requesting their participation in the survey. We 
contacted SEC to correct the e-mail addresses when they were not 
deliverable. We conducted an electronic survey between March 10, 2004, 
and April 4, 2004, and sent each employee a unique password by e-mail 
to ensure that only these sampled employees could participate in the 
survey.[Footnote 8] Individuals who did not respond to the initial 
questionnaire were sent up to two follow-up reminders. At the close of 
the survey period, we had a total of 388 usable responses, for an 
overall response rate of 73 percent.

We took steps during the design, data collection, and analysis phases 
of our survey to minimize sampling, population coverage, measurement, 
and data-processing errors.[Footnote 9] In addition to some of the 
steps described above, such as working with SEC in developing the 
population list, using pre-tested items, resolving undeliverable e-
mails, and identifying ineligible sample participants, we also 
conducted checks for inconsistencies in response to selected items and 
had a second independent analyst review all computer programs used in 
our analysis.

Survey Analysis:

The 2004 survey results are generalizable to the SEC study population 
defined as attorneys, accountants, and examiners employed at SEC at the 
time of the 2001 administration of a similar survey. These estimates do 
not reflect the views of all currently employed SEC attorneys, 
accountants, and examiners because the population from which we drew 
our sample does not include persons hired in the last three years.

Estimates were formed by weighting the survey responses to account for 
effective sampling rates in each of the two strata for the 2004 survey, 
and we applied appropriate weights to the 2001 sample to address those 
employees who did not respond to that survey. As with most surveys, our 
estimation method assumes that nonrespondents would have answered like 
the survey respondents.

Because we surveyed a sample of SEC employees in our 2004 survey, our 
results are estimates of employee perceptions and characteristics; 
thus, they are subject to sampling errors that are associated with 
samples of this size and type. Our confidence in the precision of the 
results from this sample is expressed in 95 percent confidence 
intervals. We calculated confidence intervals for our study results 
using methods that are appropriate for a stratified probability sample.

For the presentation of response percentages in the 2004 survey, we are 
95 percent confident that the results we would have obtained had we 
studied the entire study population are within +/-5 or fewer percentage 
points of our results, unless otherwise noted. For example, our survey 
estimates that 49 percent of the SEC target population was "generally 
dissatisfied" or "very dissatisfied" with "administrative resources 
(e.g., support staff) you need to do your job well." The 95 percent 
confidence interval for this estimate would be no wider than +/-5 
percent, or between 44 and 54 percent. For the 2001 survey results, we 
also used the 95 percent confidence level, which would provide for a 
confidence interval of +/-2 percentage points.

Before testing for differences between the 2004 and the 2001 survey 
results, we collapsed the two levels of both the satisfied and 
dissatisfied categories into single satisfied or dissatisfied 
categories; thus, reducing the number of categories for comparison from 
five to three. When making comparisons of percentages between the 2004 
and 2001 survey results for these collapsed categories, we used a 
pooled variance estimate. In general, if the difference between a 
survey percentage from the 2001 survey and the 2004 survey is more than 
+/-5 percentage points; the difference is considered to be 
statistically significant.


We conducted our work in Washington, D.C., between October 2003 and 
November 2004 in accordance with generally accepted government auditing 

[End of section]



[1] GAO, Securities and Exchange Commission: Human Capital Challenges 
Require Management Attention, GAO-01-947 (Washington, D.C.: Sept. 17, 

[2] A flexitime work schedule allows employees to start work earlier or 
work later or work a compressed schedule of fewer than 10 workdays per 
pay period. A flexiplace arrangement allows employees to work a portion 
of the time at home or at another location.

[3] In 2002, the Investor and Capital Markets Fee Relief Act exempted 
SEC from general federal pay restrictions and provided the agency with 
pay parity--the authority necessary to bring salaries in line with 
those of other federal financial regulators.

[4] Work-life programs help employees balance their work and family 
lives and include compressed work schedules, alternate work schedules, 
telecommuting, and part-time work arrangements. 

[5] The 2004 survey reflects reactions based on the new performance 
appraisal system that was implemented by SEC in 2003.

[6] GAO-01-947.

[7] GAO, Securities and Exchange Commission: Human Capital Challenges 
Require Management Attention, GAO-01-947 (Washington, D.C.: Sept. 17, 

[8] During our field work, we determined that eight of the individuals 
in our original sample were ineligible for our survey because they were 
no longer in the population of interest; they had either left the 
agency or they were on extended leave and not currently at work. We 
adjusted our sample size accordingly in calculating our response rate. 

[9] Population coverage errors can occur if some members of the 
population are excluded from the survey. Measurement errors can also 
arise if respondents interpret questions differently or make mistakes. 
Data processing errors can arise during data entry or analysis.