government. Consideration should be given to work arrangements and benefits that appeal to mature workers, such as flexible work schedules and other arrangements, telecommuting, phased retirement with pension protection, and family and medical leave programs.

1. The secretary should immediately strengthen workforce planning in the department and develop a comprehensive strategy to recruit highly qualified public- and private-sector individuals, in order to offset the large number of experienced staff expected to retire soon.

2. Congress should authorize the department, in cooperation with the Office of Personnel Management, to assemble a package of current and innovative programs and benefits designed to encourage talented, experienced individuals to transition back and forth between government and private-sector service, thereby identifying ways to leverage the best of both.

Congress has taken measures to help combat the problem of lower federal salaries that impedes efforts to recruit and retain experienced personnel and has directed the administration to create several different pay systems, separate from the 15 grades in the traditional General Schedule (GS) system. The intent is to give agencies more flexibility in setting employees’ salaries, especially the ability to base pay increases on performance rather than merely tenure. Still, most federal employees are paid under the more rigid GS system.

Just over 400 HHS employees are members of the SES, which now uses a performance-based pay system. Results of a survey of SES employees, published in May 2008, indicated some skepticism about the effects of this program. While more than 90 percent of the department’s SES employees support the notion of performance-based pay, only 44 percent believe it has improved their organization’s performance, and