In an era of shrinking defense budgets, President Obama’s fiscal 2013 budget forges ahead with existing plans to strengthen the acquisitions workforce through improved management and modest increases in hiring. Still, many in the contracting community appear resigned to seeing fewer opportunities as the government seeks a proper balance between in-house and contracted management.

In its broad themes, the Defense Department budget stresses “better buying power” and creating new efficiencies and improving productivity through such tactics as reducing high-risk contracts and cutting spending on contracts for management support services.

The Pentagon’s request for $274.2 million for the Defense Acquisition Workforce Development Fund reflects its “continuing efforts to strengthen the acquisition workforce, which includes efforts to right-size and right-shape the workforce,” a department spokeswoman said in an email to Government Executive.

“We have increased the number of people in the acquisition workforce over the last few years,” the spokeswoman said. The president’s budget proposes resources that will help sustain recent new hires, “and some additional hiring under the initiative is provided for,” he said. “As we finish the capacity-building initiative, we are increasingly turning our attention to initiatives to improve the capability of the workforce that we have.”

Since 2008, the Pentagon has used the acquisition fund to fill 6,400 new positions in such areas as engineering, contracting, acquisition management and audit. Training capacity has risen by 19,000 resident and 100,000 online seats annually. Such additions are strategic, the spokeswoman said, because of demographics and recent budget tightening: 17 percent of the workforce is eligible for full retirement today and 19 percent is eligible within five years. Workforce gains decreased 32 percent between fiscal 2010 and fiscal 2011, and losses spiked up 32 percent between 2010 and 2011, she said.

And while the size of the acquisition staff is important, “ultimately, it is the quality of the workforce that determines the quality of our acquisition outcomes,” she said.

The Obama administration’s early efforts to reverse its predecessor’s tendency to increase the use of outside contractors in acquisitions slowed toward the end of the tenure of Defense Secretary Robert Gates.

But the Office of Federal Procurement Policy is quick to stress that the goal has been less to simply boost hiring than to “make sure we have the right balance of federal employees and contractors,” said a spokeswoman for the Office of Management and Budget. “Insourcing is a tool to help rebalance where work needs to be brought in-house, such as where the work is inherently governmental or the work involves a critical function and the government is at risk of losing control of its operations.”

The acquisition reforms and guidance of the past three years were intended to hold contractors more accountable for providing value, she added. “We have not seen, nor do we expect to see, a substantial shift to in-house.”

Dan Gordon, who left his post as Obama’s administrator for procurement policy in late 2011 to become associate dean for government procurement law at The George Washington University Law School, said in an email that he commends the Defense Department and the administration for continuing to rebuild its acquisition workforce.

“Almost every contracting challenge we face — in particular, poor acquisition planning, unjustified sole-source contracts and inadequate oversight of contractors — can be traced back to our failure during the 16 years before this administration to invest in the federal acquisition workforce,” he said.

“While I understand the reluctance to hire thousands of new federal employees, rebuilding our federal acquisition capability represents a sensible investment where money spent on hiring and training should pay off in terms of improved contracting, meaning a reduction in waste and fraud.”

Many in the contracting community have mixed feelings about the budget’s implications. Stan Soloway, president and chief executive officer of the Professional Services Council, says, “$274 million sounds like a ton of money, but it doesn’t go far when you’re talking 100,000 to 200,000 people.” He called it “a sustainability question,” noting that 75 percent of the Pentagon’s new hires are interns, of whom less than a third will stay.

Soloway said Frank Kendall III, acting undersecretary of Defense for acquisition, technology and logistics, is on top of the task of boosting capabilities of the acquisition workforce. “We on the private side would like to see it successful because bad procurements are not good and a smart customer is a better customer,” he says. He warned against a repeat of the 1990s “hollowing out” of key elements in the workforce, which he says left the government unable to handle the most technologically advanced contracts.

Trey Hodgkins, senior vice president for national security and procurement policy at TechAmerica, agreed the White House is committed to maintaining the acquisition workforce, but he still sees leaner times ahead.

“The reality of the budget is that one of the first things cut will be full-time equivalent positions, and we’re hearing they’re doing it through attrition,” he cautioned. “We will see a reduction in the number of contractors, but it won’t be at the hands of insourcing.”

Some critics argue that the strengthening, or insourcing, of the acquisition workforce hasn’t gone far enough. Winslow T. Wheeler, director of the Straus Military Reform Project at the Center for Defense Information, said, “outsourcing has gotten massively out of control, [and] our oversightless Congress has been ignoring the matter other than occasional rhetoric.”

He says an essential step is to audit the “money being spent on outsourcing and to start reducing it. Simultaneously, the resources spent on finding and hiring insourced government auditors and improving their skills is . . . the key to saving real money.”

— by Charles S. Clark, Government Executive, March 2, 2012, http://www.govexec.com/contracting/2012/03/pentagon-seeks-strengthen-acquisition-workforce/41369.