New York Times on the financial hardship of NASA employees

This is kind of interesting from a newspaper that prides itself on in-depth reporting… An article on furloughed NASA employees asserts without evidence that they could be making 2-3X more money in a private sector job:

No matter how vital high-skilled federal workers are to the functioning of government, there are usually companies willing to offer them much higher salaries — double or even triple in some cases — on top of the free lunches and stock options.

Are they doing any consulting work during their furlough? If they are valuable to private companies as employees, at least some should be worth $300 or $500/hour to consult, no?

The workers at Glenn are mostly waiting, drawing down savings, wondering about the state of their untended lab work, reading about Chinese spacecraft landing on the moon and pondering the appeal of the public good when a good chunk of the public seems to have little use for it.

They’re “mostly waiting” instead of doing consulting work for these private employers who are desperate for their services?

Yet more stranger (as we liked to say back in junior high): Drawing down savings.

A quick Google search reveals that NASA employees are eligible to borrow money at 0% from their own NASA Federal Credit Union:

Our special Furlough Relief Loan will allow you to access up to $10,000 for up to a 60-month term – interest free and payment free for 60 days.* This offer will be available through February 15, 2019.**

So these folks are geniuses who could get paid $400,000/year simply by walking into the HR department of a private employer, but they aren’t smart enough to go to the credit union web site and click “apply now” for their 0% loan?

How did the reporter and editors miss this? Neither the word “credit” nor “loan” appears in the article so they don’t address the question of how people who are able to borrow at 0% and whose entire annual salary is guaranteed to be paid (albeit with a delay for at least two paychecks) are being forced to deplete savings.

The unedited Web seems to be a lot more authoritative that the Paper of Record. Consider this 2014 exchange on, “Any aerospace engineers? Pros v. cons of working for NASA v. private sector”:

This isn’t a NASA specific issue, but almost all federal employees are on the GS pay scale. That caps their pay at level IV of the executive schedule, which is now $164,200. … Most NASA employees are in the business of contract management. The real engineering gets outsourced to contractors. If he wants to do research and development, he should go work for a contractor. If he wants to become an expert in federal acquisition regulations, he should go work at NASA.

From a financial perspective, he will probably never make up the lost 4 years or so of income if he gets a PhD.

I worked at NASA for a while… NASA contains a huge amount of unmotivated government employees. They’re so expensive that they have to contract all the work out. Even then money is so badly mismanaged that there is no incentive to deliver a project on time. If you’re nearing retirement, it’s a great place to be as it’s virtually impossible to get fired. They’re just shift you from job to job.

I talked with a SpaceX recruiter. Was going to be a significant pay cut, and the recruiter kept mentioning long (70+) hour weeks. For the high cost of living area, it didn’t make much sense. It was clear they were banking on the “sexy” factor of SpaceX to make up for the hours and low pay.

I worked at Goddard Spaceflight Center… And while the raw salary was meaningfully lower than what the contractors were making at comparable position levels, the overall benefits package was WAAAAAAY better — much, much more paid time off, much better healthcare, and significantly better retirement benefits.

A message from the bogleheads exchange that STEM boosters probably won’t be sharing:

I have worked for a large aerospace company (think Boeing, Lockheed, Northrop) and currently work for a tier 1 aerospace supplier. All big companies are the same, with tons of bureaucracy, politics, mediocre raises, lots of old timers that are dead wood, etc, etc. Hopefully he is passionate about it because he probably will be living a normal middle class life and will make starting 75K/yr – 150K/yr (after 15-20+ years experience) throughout his career.

8 thoughts on “New York Times on the financial hardship of NASA employees

  1. I can’t say I know much about the market for government engineers, but these sorts of arguments are often made for government lawyers, and they are misleading. Very few government lawyers can easily move to a top private sector job because the government skill level is usually much lower than what is found in the upper echelons of the private sector as is the work ethic. Capable government lawyers will usually leave after gaining a few years of experience and those that stay are typically unemployable in the private sector after a certain age. In my experience, federal government workers are paid well, though not exorbitantly (salary + benefits) for what they do & it is hard to imagine government employees at the professional level who lack sufficient savings to tide them over in a period like this. Government lawyers usually stay in government because of a lack of opportunities in the private sector and their preferences for leisure over compensation — not because of beneficence.

  2. > How did the reporter and editors miss this?

    Think of a human mind as having multiple parts.

    There is a part that uses reason and logic to optimize an outcome. Call this the “reason part”.

    There is a part that takes any situation and spins it so that people who the mind hates are doing a bad thing, and people who the mind likes are victimized. Call this the “emotional part”.

    You are using the reason part of your mind. Almost every human uses the reason part when they are personally in a bad situation. I would bet that every NASA employee who is not getting paid has thought of taking a loan if they need the money.

    People who have no actual stake in the outcome of a decision use the emotional part of their mind. In this case, the reporter has no personal stake in the outcome (they are not federal employees). The reporter does have some tribal allegiances:

    * Federal employees are good.
    * Trump is very very bad.

    So, they spin the story to make the NASA employees victims and blame it on the bad bad man.

    My theory makes prediction: If the reporter who wrote this article is ever laid off for a month, and everyone knows they will get back-pay, they will suddenly be able to reason about the situation, and get a loan.

  3. An article on furloughed NASA employees asserts without evidence that they could be making 2-3X more money in a private sector job

    Towards the end of the article they mention a guy who left during the 2013 shutdown:

    A Silicon Valley firm emailed him, asking him to visit in his spare time. He went, learned he could be making double his salary and shortly after the shutdown ended, left government for good.

    Perhaps you didn’t read all the way to the end.

    Also, your point about the credit union suggests not only are these people not worth $400,000 a year, there barely worth minimum wage. There’s probably more to the story.

    • It is great that out of a population of at least 20,000 (17,336 current workers), the reporters managed to find one example of a guy who quit NASA and obtained substantially higher pay and they had to look back only 6 years to find that single example (he quit in 2013).

      Even an English or Journalism major should be able to figure out, though, that a 1 in 20,000 example does not support “there are USUALLY companies willing to offer them much higher salaries”. That’s what makes the article interesting!

  4. That bogleheads bboard exchange makes me think that the private sector space industry actually pays less per hour worked: “NASA contains a huge amount of unmotivated government employees. They’re so expensive that they have to contract all the work out.”

    If it is cheaper to farm out work to contractors, doesn’t that suggest that the contractors are paying less for a given amount of productivity (roughly correlated with hours)? Maybe the contractor pays a little more (before pension and benefits are figured in), but expects 2-3X as many productive hours worked per week.

  5. Like everything in life, it’s complicated.

    I was an engineer that worked my entire career for the U.S. Dept. of Defense.

    The Government’s ability to get engineers is highly dependent on the economy. When the economy is good, there are massive (almost crippling) shortages of entry-level engineers in Government agencies. When times are bad, the Government agencies can more easily fill their entry-level engineering positions. Then the economy heats up and most of the junior engineers leave for the private sector. Rinse, repeat….

    This cycle happens because as a young engineer you are woefully underpaid, so you only take the government job as a last resort when industry isn’t hiring. You get one to three years work experience in the Government and you jump to the private sector when you can.

    If you graduate with really bad timing like 1981 or 2008, you may not be able to get out in a few years and the Government becomes a career. At somewhere around the seven-to-ten year point, it’s probably a “wash” between the private sector and Government pay/hours/benefits unless you have a sought-out specialty with appropriate security clearances. I actually personally saw a guy with the right credentials go from 125K in Govt to 500K in the private sector during the 2000 dot com timeframe. But for most in the seven-to-ten year range, you’re getting more pay to leave, but you’re working more hours that offset the increase. I had a friend do just that and he came back to the govt after a couple years so he could spend more time with his young kids.

    When you’re in the 15+ yr range, you’d be foolish to leave the Govt. unless your specialty suddenly becomes in high demand and you can make the big bucks.

  6. By the way, regarding the contractors… This is gross oversimplification but there are two main kinds…the hardware/software engineers working for the big defense contractors like Lockheed Martin, Raytheon, Boeing, etc., and the contracted support services (CSS) contractors. Although there are some very highly paid personnel at the some of the CSS contractors, the bulk of them are usually lower-skill employees doing the “grunt work” in support of the Government engineers (for example, doing labor-intensive technician-level work to gather information so the Government engineer doesn’t have to spend time on that portion of the engineering task). These CSS contracts (unless they are small-disadvantaged businesse set-aside contracts) are often time-and-material contracts that are awarded to the lowest bidder.

    The real money for an employee with the right skill set is working for the big defense contractors because the non-recurring and recurring engineering costs are rolled up into the cost of the end product such as a submarine or fighter aircraft on a fixed-price contract. Even on a cost-based contract, the Government has a hard time challenging the cost of the R&D engineers since it’s such a competitive labor market.

    Agsin the above is a simplified explanation.

  7. I found competent and incompetent in government and out of government. Really hard to say which is concentrated where, especially when the responsibilities aren’t all that comparable (government being more managerial). Your government guy really is a “company” man very much aware that all the other “company” men are watching and judging his every move. Academics is different.

Comments are closed.