Leaving Fed for Private Contractor

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NYCProjectEngineer PE PMP

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Right now I am employed by the Federal Government (GS-12 level) and work on construction projects as a Project Engineer. I have recently been offered multiple jobs in the private sector at top contractors (ENR Top 10) for about a 30% pay raise after-taxes. Also, I have been told that I will have the chance to be promoted in the next month or so to Resident Engineer (GS-13) which is about a $10k pay bump but with supervisory responsibilities. 

I am torn as to what to do... should I leave for the pay bump or stay for the job security? Anybody here ever make the move from public to private and have some advice?

 
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Unless you're just sick and tired of working for the fed, I'd stay for the job security....

Your pay bump upon leaving for private sector will likely be the last big bump.  At least with the fed, you get regular increases. (more or less)

 
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Not to mention your Fed pension which most likely isn't available with private contractors...

 
FERS (current Fed pension) is 1% per year of service of your top-3. So if I never leave and retire at 62 I will get 40% of my top-3 or $38,000/yr pension based on my current salary. 

The Fed 401k program is pretty good with match up to 5%.

Problem is I am leaving $30,000/yr salary on the table...

 
Out of my 20 years 7 years was public.

I don't regret it at all. You get more money, an actual bonus, usually better than average 401k match, and from what I am finding the insurance is cheaper. Pay bumps in the private sector are much higher when years are good. In government everyone gets the same wether they work hard or show up...

You do have to work more, chase work, sacrifice some time that government employees don't.

That being said the years I worked for the government my kids were young and it was helpful to be able to take time off and deal with them as I needed.

 
So... coming from a "youngin"... I'm on about 10 year career/employment at this point. This is just personal experience and what I've observed. I've been comparing notes with my friends and we think we've figured it out. haha! Granted it varies from on field to another but we've all made similar observations or know someone who has gone through this. 

First 3.5 years I worked for a consulting firm. Next 3.5 years for a government contractor. And close to 2 years now with feds. (Yeah... I know... someone is going to do the math... not 10 total but 1 year in there I did some related internship work while in grad school. So there!) And, yes, over the last 19 months I've gotten the calls and emails, letters, LinkedIn messages promising this and that, and offering great opportunities. I respond to all of them and thank them for their time, file them, just in case. So far, I've counted 23 unique contacts. That 10-15 year experience range is really sought out so get used to the offers.

Now to explain where I'm coming from...

- My best paying and sweetest job was with the government contractor. High salary with a masters, bonuses for performance and when products we worked on sold well, freebies at work, great insurance, great benefits, loads of vacations, great flexibility, freedom to do what I wanted on a project to make it happen etc... But when things got tight, the ax came down fast. Hunting for internal work and making sure you were billable was priority, sending out white papers and trying to get work contracts regardless of your level, volunteer time off came around without guarantee that things were going to get better, and eventually layoffs. Now... this happens everywhere but the odd thing is that the company was doing well. They just were not meeting quota for a number of products that they kept shooting higher and higher to sell to the government. So, when the government wasn't buying, to them that was "red" and needed to be compensated by letting people go to keep shareholders and the stock market happy. It ended up backfiring though because people don't like feeling unsettled. They got rid of "extras" I suppose and kept "key" people. The "key" people got uncomfortable and found new jobs right after the layoffs. The company ended up trying to get others to come back or hiring new people. Not a good situation.

- My "worse" was the private consulting firm. But I was also starting to work and had no actual experience so it's understandable. The hours were often crap, the managers were not people I found particularly bright, the benefits were mediocre, the learning experience was mediocre. I did learn a lot because I was starting from zero but beyond that, it was a dead-end exercise. I had one younger manager who was good and cared about your progress. There were a couple of others who I managed to get some good experience working under once I figured out their personalities and managed to be useful to them. The rest were people who did well in college, just shooting to be PM and eventually making VP. That's where the "security" was because they become shareholders at that point. The board has to pay them to leave if they're not happy with them. In any event, when things got tight, again, layoffs. Again, that's not uncommon anywhere but this is what got me.... 2 months before the layoff, they gave bonuses to everyone, had a party, etc... When I brought up that I'd want to go to school full-time and work part-time because my workload was light, I was told that no one is guaranteed 40 hours of work nor pay but had to be in the office 44 hours per week. Hummmm ok.

- Current job is with the feds and is somewhere in between but closer to the "sweetness" of the contractor in terms of satisfaction. I think I lucked out with some supervisors who came from private and understand how things are meant to work. So I've had it a bit easier than most with the government red tapes, slow processes and nonsense that people usually have to complain about. It also takes a lot of advanced planning and anticipation on my end but at least that works. Also, the wealth of knowledge and people willing to share and teach so far has been great. I'm given more responsibility without a manager trying to take credit for my work. Knock on wood but it's been quite fitting so far. The salary is about what I'd be getting at a private consulting firm but that might be only because I got lucky with negotiations prior to accepting the job. Though, it is lower than what I'd get with the contractor. The benefits/matching are about the same in terms of 401K equivalent. Now, I haven't figured out the pension thing. Maybe I don't understand it very well but it didn't seem that impressive. People on the old pension have a better payout. The flexibility is better than private and the other benefits are just as comparable (insurance, sick days, discounts etc...). But yeah... no considerable bonuses.

So, I think overall, I can make more in private than I'm making with the Feds when you consider salary, benefits, bonuses etc... But, what I'm getting now and in the long run is much more worth it. Especially that I value my time and sanity a bit more in my "older" age.

Ok... now you know my story, this is what my friends and I figured out having been on these three sides... Before you take that jump, consider what kind of business these private firms are in. If you're not one of those people who network, make contacts, a shaker as they say, know the ins-and-outs of contracting and getting contracts.... be careful. A lot of these companies won't come out upfront to say it but they're essentially looking for someone who can get their foot in the door to a government contract/job. If you can't deliver, you'll be dropped really fast. More of your time will be about customer service and you have to find your own leads. I've seen it with both the private consultant and the contractor. Private companies are all about getting jobs in to keep going so if you're not able to contribute, you're not in a good position. Also, if you're switching to private, you don't want to move in for a high salary alone. You want to negotiate that shareholder/VP package or whatever "security" enticement that they offer. It makes it harder to get pushed out. Private company I worked for had a number of lame ducks around just because it was too pricey to get rid of them haha! They changed the requirements to be VP really fast after the recession. 

Morale of the story, it might look greener on the other side but if you're not looking at the business' growth and needs strategy, you're not looking at it right. The people I know who have done it best went at it this way, by design or accident... They started out in private and got all that private "efficiency" business model down. So, when they go to a Fed or State, I suppose that becomes valuable. They stick around for the retirement (20 years or whatever), do some personal consulting during that time on the side, then go back to private when they retire if they don't want to just to their own consulting anymore. If you think about it, that could be: Age 21 to 31 gives them 10 years in private, then 31 to 51 that's 20 years with feds, then 51 to 65 for close to 15 years back to private if they don't want to stick around.  A lot of times, they become private consultants for a private company. That fetches a lot of money but you have other headaches to deal with. Other times, they go work for the company but again they negotiate that shareholder package and high salary. At that point, they left government with a GS-15 (a number were GS-13), and could bring that experience from the other side. But more often than not, they're working to help that private company win government jobs because they have the experience and know the processes. 

So... if you're not there, thread lightly.

My 2 cents. Good luck!

 
Make sure you consider more than just salary.  Benefits, especially insurance, can be hit or miss in the private sector.  Depending on the company, you may lose a decent chunk of that $30k paying for crappy insurance.  You also have to consider what your time is worth.  I was a contractor at Cinergy (now Duke Energy) for about nine months and the guys there used to look at me like I had two heads when I was leaving after my 8 hours.  Full time salaried Cinergy employees were expected to put in at least 45 hours a week.  When the clock hits 4:30 here, I'm out the door.  I'm willing to bet that you won't get anywhere near the amount of vacation/sick time you get with the Gov't either.

 
Another non monetary thing to consider-When you look long term in government your reward (as you move up the chain) is supervising more and more people.

I used to have around 60 employees. Total PIA. Someone's always got some issue to deal with, wants time off, is harassing someone, taking a work truck to the wrong place at lunch, it just never ends.. Now I only have 8 direct reports and they know they can be canned if they do any of that **** without going through any government process..(I know I can be canned also)

I truly don't miss that headache.

Plus a few Friday's ago we all took off and played drunk kick ball, where you have to have a beer in your hand while you are playing and finish it before the inning is over or before you cross home plate. Company paid for it all :)

 
In my particular area, if one puts in some good research, private sector employers can be found which usually exceed the "benefits" of working for govt.  I can pretty much counter each benefit aside from a pension. Which my current employer does have in place, but only for those veteran employees who were grand-fathered in.  Though their higher than average 401k matching makes up for the lack of a pension (which can technically be cut at any time vs. a fully vested 401k).  And if budgets are "re-structured", often times no one gets a raise.  There are some here working in govt. who hadn't had a raise in something like 4 years or whatever.  At least in private sector this can be negotiated but is typically 3-5% each year provided there is some level of financial stability within the respective company.

 
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Another option to consider:

 

Depending on the industry, if you stay for a long time you build up a wealth of contacts.  If you’re willing to be a marketing person  / “rain maker” the private world will pay extensively for those contacts when you retire.  & it really doesn’t require that much work . You get the retirement plus a $150K + salary to basically take people out to lunch..

 

Most people in government after 30 years really do lose the ability to do “real work” (from a private life standpoint) I saw it in my former boss at my previous government job.  He knew everyone in the state very well (including people that went from County Commissioner to Governor), could have made a fortune, and he wanted to go into consulting after he retired but he told contractors and consultants that he didn’t want to do any marketing?  Usually in Civil this consists of taking people to lunch, writing proposals, golf, etc, not door to door selling of candy bars or anything.  I guess he thought people would pay him to sit around and review plans and manage projects.  He was a hard government worker but he had lost the ability to do work himself, (relied on secretary’s, large staff of people to get anything done). 

 

We worked very hard and long hours when I was in the G-Life, I was in an ‘At Will” position and could be fired by the Director or County manager at any time (& I was reminded of that weekly sometimes), but it was a different kind of “work” that I don’t do in the private world. I worked the same number of hours, just instead of working all weekend for some proposal or interview for work I was getting called out to some field emergency or some minor natural disaster every few weeks or in the middle of the night.

 

FWIW, I am glad I left G life before I too lost the ability to self-perform a lot of work.  Consulting PM work is largely an administrative job, letters, setting up meetings, invoices, creating schedules, financial accountability, and marketing work.  I had to catch up a lot when I made the transition. I went from having a decent sized staff to do the grunt work, to sharing one secretary between 6 project managers. You learn quickly to just do stuff yourself.. So if you want to make the jump do it before you totally lose the ability to function in the private environment.

 
Wow some really good insight in this thread. Losing my almost 4 weeks vacation per year is gonna be tough (plus unlimited sick. I have to give both Tishman and Skanska an answer tomorrow so i got some thinking to do tonight.

 
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So....what did you decide???
Decided to stay in the Fed with the promotion to Resident Engineer. The prospect of being "the man" on the project and working on a $500MM program in the next year or two was the deciding factor. Its definitely a tough to leave $30k after-tax on the table but the job security in the Fed is priceless.

 
Is this negotiable?  I've been carrying my accumulated vacation time through to the various employers since I started my career.  But it took a good amount of negotiation to keep it at my desired level.
All three companies were not willing to negotiate PTO/vacation. I think only VP-level executives have the ability to negotiate PTO in the construction contracting industry.

 
Congrats on your promotion! Having gone through this experience, you have upper hand and more wisdom. I'm sure it will come in handy and the offers will come in again. It's nice to be in demand. This new position will only strengthen your appeal. I personally feel like, in today's economy, a move has to come with VP-like benefits to be worth it. Loyalty in private sector is fickle. Congrats and good luck!

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Congrats on your promotion! Having gone through this experience, you have upper hand and more wisdom. I'm sure it will come in handy and the offers will come in again. It's nice to be in demand. This new position will only strengthen your appeal. I personally feel like, in today's economy, a move has to come with VP-like benefits to be worth it. Loyalty in private sector is fickle. Congrats and good luck!

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Thanks! I figure I can work for another 10 or so years hopefully end up at GS-14/15 level and then look to make a move over to a Project Executive/VP type role. 

 
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