Key Issues > High Risk > Strategic Human Capital Management
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Strategic Human Capital Management

The Office of Personnel Management and federal agencies must continue developing the capacity to measure and address existing mission-critical skills gaps, and use workforce analytics to predict and mitigate future gaps so agencies can effectively carry out their missions.

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Mission-critical skills gaps both within federal agencies and across the federal workforce pose a high risk to the nation because they impede the government from cost-effectively serving the public and achieving results. This area was added to the High-Risk List in 2001.

We, along with OPM and individual agencies, have identified skills gaps in such government-wide occupations in the fields of science, technology, engineering, mathematics, cybersecurity, and acquisitions. Causes for these skills gaps vary; however, they often occur due to a shortfall in one or more talent management activities such as robust workforce planning or training.

Additionally, the changing nature of federal work and the high percentage of employees eligible for retirement could produce gaps in leadership and institutional knowledge, and could threaten to aggravate the problems created from existing skills gaps. For example, 31.6 percent of permanent federal employees who were on board as of September 30, 2017, will be eligible to retire in the next five years with some agencies having particularly high levels of employees to retire.

Mission-critical skills gaps are a contributing factor in making other areas across the government high risk. Of the 34 other high-risk areas, skill gaps played a significant role in 16 areas, such as veterans' health care.

Strategic Human Capital Management

For this high-risk area, all five criteria remain unchanged since our previous report in 2017.

Leadership commitment: met. The Office of Personnel Management (OPM) continues to demonstrate top leadership commitment through its numerous efforts to assist agencies in addressing mission-critical skills gaps within their workforces. OPM’s regulation on strategic human capital management, which took effect in April 2017, requires executive branch agencies to issue human capital operating plans that, in part, must describe the agencies’ skills gaps and the strategies to be used for closing these gaps. OPM has provided guidance, training, and on-going support for agencies on the use of comprehensive data analytic methods for identifying skills gaps and the development of strategies to address these gaps. Additionally, the Director of OPM uses the Chief Human Capital Officers (CHCO) Council’s quarterly meetings to review and discuss agency data on the closure of agency-specific skills gaps.

Capacity: partially met. OPM and the CHCO Council continue supporting the efforts of the Federal Agency Skills Teams (FAST), which consist of occupational leaders and CHCO representatives who are responsible for setting goals for closing skills gaps and using measureable targets and appropriate metrics. OPM staff meet quarterly with FASTs to provide guidance on the development of action plans and use of OPM’s multi-factor model, a methodology for identifying skills gaps. In mid-2019, OPM plans to launch an automated version of the multi-factor model to facilitate and promote its use among FASTs.

Action plan: partially met. On a quarterly basis, OPM staff review and provide feedback to FASTs on the content of their action plans, such as the identification of the root causes for the skills gap, assignment of roles and responsibilities for implementing strategies, and the creation of outcome-oriented performance metrics. Additionally, OPM staff stated that they continue to train FAST members on applying OPM’s multi-factor model, developing a sound action plan, and identifying strategies for addressing identified skills gaps.

Monitoring: partially met. On a quarterly basis, OPM provides to agencies’ management and FASTs a data dashboard of 12 metrics which gives a snapshot of agencies’ progress on closing identified skills gaps. In March 2019, OPM plans to begin a "midterm" review of agencies’ efforts to mitigate skills gaps by issuing a memo to agencies asking for the status on their specific skills gaps and a description of challenges encountered during their efforts.

Demonstrated progress: not met. On the one hand, OPM has, among other actions, issued a regulation and developed tools and processes that could help agencies better identify and address current and newly emerging skills gaps. Additionally, senior agency leaders are required to meet annually with OPM officials to hold high-level, data-driven discussions on agencies' progress towards meeting their human capital goals.

On the other hand, OPM needs to ensure that individual agencies implement guidance, tools, and training, and fully develop and implement effective strategies to mitigate and close skills gaps within their own workforces. For instance, the inability of the Veterans Health Administration’s human resource staff to implement an effective recruitment strategy has affected the ability of its medical centers to maintain an adequate team of medical professionals to meet veterans’ health care needs.

Agencies' critical skills gaps contributed to 16 other high-risk areas and are noted throughout this report. They include 2020 Decennial Census, Strengthening DHS Management Functions, DOD Business Systems Modernization, DOD Financial Management, DOD Contract Management, DOE’s Contract Management for the National Nuclear Security Administration and Office of Environmental Management, U.S. Government’s Environmental Liability, Improving Federal Management of Programs that Serve Tribes and Their Members, Management of Federal Oil and Gas Resources, NASA Acquisition Management, Protecting Public Health through Enhanced Oversight of Medical Products, Improving and Modernizing Federal Disability Programs, VA Acquisition Management, Managing Risks and Improving VA Health Care, Ensuring the Cybersecurity of the Nation, and Improving the Management of IT Acquisitions and Operations.

Over the years since we added this area to our High-Risk List, in addition to recommendations to address critical skills gaps in individual high-risk areas, we have made numerous recommendations to OPM related to this high-risk issue, 29 of which remain open. OPM needs to fully address the recommendations in our January 2015 report which call on the Director of OPM to make more strategic use of government workforce data to build a predictive capacity for identifying and mitigating emerging skills gaps across government. Our January 2015 report also recommended that OPM work with agency CHCOs to bolster the ability of agencies to assess workforce competencies by sharing competency surveys, lessons learned, and other tools and resources. Agencies also need to take action to address mission-critical skills gaps within their own workforces—a significant factor contributing to many high-risk areas.

Looking for our recommendations? Click on any report to find each associated recommendation and its current implementation status.