Federal Workers May Be the Next Big Hiring Opportunity

Return to the office or resign.

That was the decision nearly 2 million federal employees were confronted with in a Jan. 28 email titled “Fork in the Road,” outlining U.S. President Donald Trump’s plan to end remote work arrangements and return to fully in-person work. Employees who chose to resign had a Feb. 12 (initially Feb. 6) deadline to quit, with pay and benefits retained until Sept. 30.

Approximately 75,000 federal workers accepted the offer, McLaurine Pinover, a spokesperson for the Office of Personnel Management, told the Associated Press. Additionally, more than 20,000 federal employees — most of them probationary workers — have been fired from their jobs as part of the President’s plan to downsize the federal workforce.

For these former public-sector workers, navigating a competitive labor market can come with its set of challenges, but for total rewards (TR) professionals in the private sector, now may be the time to seize this pool of skilled and talented employees.

Access a bonus Workspan Daily Plus+ article on this subject:

• Culture Shock: Integrating Federal Talent into the Private Workplace

What Can These Workers Offer?

Public-sector employees bring a strong foundation of transferable skills that are highly valuable in corporate environments, said Malika Terry, CCP, an independent consultant specializing in total rewards and human resources and a member of WorldatWork’s Compensation Advisory Council.

She said these workers’ expertise in strategy and policy development, compliance, and project management — as well as specific skills in problem-solving, stakeholder engagement and operational efficiency — should resonate with private employers across industry sectors.

Christopher Nickson, a vice president at HR and benefits consulting firm Segal, added former public-sector workers can offer a deep understanding of the inner workings of the respective government departments and agencies they previously worked for.

“For private practitioners who work with federal agencies and departments, the decision-making processes seem opaque and unduly time-consuming, and former public-sector workers can often bring much needed clarity to these processes,” he said.

Effective communication is vital in the public sector, where workers regularly interact with the public, stakeholders and other government entities, said Tom McMullen, a senior client partner at Korn Ferry.

“Many public-sector positions involve direct public interaction, enhancing their customer service skills and ability to work with diverse populations,” he said. “Public-sector workers are also accustomed to navigating changing regulations, policies and political landscapes, making them adaptable and resilient. They’re also trained to make decisions that uphold public trust and adhere to ethical standards, which is valuable in any workplace.”

Data from Lightcast, a labor market analytics company, revealed the top 10 private-sector industries where public-sector skills — such as the ones listed by the experts in this article — would be most useful:

1. Manufacturing
2. Retail trade
3. Finance and insurance
4. Professional, scientific and technical services
5. Accommodation and food services
6. Administrative and support and waste management
7. Information
8. Wholesale trade
9. Real estate and rental and leasing
10. Healthcare and social assistance

Additional Lightcast data shared by Cole Napper, the company’s vice president of research, innovation and talent insights, showed the industries bolded above have some of the greatest risk for having labor shortages between now and 2030, which could provide more opportunities for public-sector workers looking to transition to the private sector.

“If private-sector employers are willing to consider skills-based hiring, there is substantial overlap between the skills government workers possess and the skills [needed in those industries],” Napper said.

Challenges They May Face

According to Alicia Scott-Wears, a compensation content director at WorldatWork, HR departments and their total rewards professionals may need to help federal workers overcome some challenges as they move into new roles. These worker challenges can include:

• The perception of private-sector employers. Private-sector employers may view federal workers as potentially overly process-driven, slower to adapt to change or unfamiliar with profit-driven decision-making.
• The translation of skills. Some federal job titles and responsibilities may not have a direct equivalent in the private sector, adding a layer of difficulty to communicate their transferable skills within a resume. Things like security clearance, compliance expertise and policy-making experience may not be immediately recognized as valuable beyond government or defense-integrated industries within the private sector.
• Adjusting expectations surrounding pay and benefits. Federal employment has rigidly structured pay scales and robust benefits, including pensions and job security that are not as commonplace in the private sector. Past federal employees will need to adjust to pay philosophies that are more performance-based and rewards packages that may have lesser benefits than the government, as well as shift to at-will employment.
• Networking gaps. Past federal employees may not have the robust professional network with industry peers, which can make job searching in the private sector potentially more difficult.

Another challenge this workforce will likely face is the potential flood of similarly skilled workers in the market, Nickson said.

“This will be coupled with needs and expectations of candidates who have lost valuable benefits from their public-sector jobs and will be looking for private-sector employers to make up those benefits with strong compensation packages, but there will be a more limited supply of those jobs available,” he explained.

Expectations with Compensation and Benefits

According to McMullen, federal employees with a bachelor’s degree or higher often earn less in wages compared to their private-sector counterparts. However, those with less education tend to earn more in federal positions, he said, and the private sector generally offers higher wages for highly educated employees, reflecting the competitive nature of private industry.

In fact, Lightcast data found the average salary between public-sector work and the same job at a Fortune 1000 company differed by $34,429.

“Average salaries for the top 10 federal government occupations when looking at those same jobs in the private sector and salaries are even higher in Fortune 1000 companies,” Napper said. “As a result, highly skilled employees in the public sector who have overlapping skills with those needed in the private sector could actually be drawn to jobs in the private sector as they would be better compensated for the work that they do.”

Often, the typical tradeoff for public-sector workers is foregoing compensation in favor of better benefits, as well as a measure of stability, said Nickson.

“That notion of stability has been radically altered, not only for those who have left their public-sector jobs, but also for the many public-sector workers still employed who face significant uncertainty for the future,” he said. “Private-sector HR and TR professionals should lean into the natural advantage they have around typically higher compensation rates. Employers may need to reconsider their total rewards philosophy, including benefit offerings, to attract former public-sector employees who have come to rely on and expect such offerings. This likely starts with an evaluation of the current total rewards philosophy and benefit offerings.”

Communicating Total Rewards

To attract and retain talent transitioning from the public sector, TR professionals must clearly differentiate private-sector rewards from traditional government benefits, said Terry. She advised TR professionals to:

• Break down the compensation structure. Public-sector employees may not be familiar with terms like performance-based pay, variable pay, incentive compensation, equity compensation or wellness incentives. Providing side-by-side comparisons with their current benefits can be helpful. Partnering with the compensation team to create a standardized comparison template may also help streamline discussions.
• Highlight career growth and professional development opportunities. Unlike government roles with structured promotions, the private sector offers faster career advancement, performance-based bonuses and skill development programs.
• Clarify retirement and healthcare differences. Many public-sector workers are used to pension-based retirement. Explaining 401(k) matching contributions, health savings account (HSA) benefits and equity compensation can clarify the financial advantages of private-sector plans.

“HR professionals aiming to recruit employees from any industry should effectively articulate the employee value proposition (EVP) of their rewards package,” said Marta Turba, WorldatWork’s vice president of content strategy. “Why should a candidate choose your company as a place to invest their time, talents and perspective? Sometimes, conveying the EVP can be challenging, and understanding the rewards system the candidate comes from helps the TR professional determine how to tailor messages in a way that promotes understanding, appreciation and interest in a new opportunity.”

Additional perks like travel stipends, flexible schedules or work-from-home options should also be showcased, said Jasmine Escalera, a career expert at LiveCareer, a resume builder website.

“Tailoring these messages to reflect the values and needs of employees coming from the public sector will help them feel welcomed, valued and ready to join your company,” she said. “As government employees get pushed back into the office, highlighting any available remote work opportunities is a great strategy to catch the eye of someone who’s not ready to go back to onsite work.”

Editor’s Note: Additional Content

For more information and resources related to this article, see the pages below, which offer quick access to all WorldatWork content on these topics:

• Employee Benefits
• Employee Compensation
• Total Rewards