Foreign Relations of the United States, 1977–1980, Volume XXVIII, Organization and Management of Foreign Policy

134. Memorandum From the Under Secretary of State for Management (Read) to the Deputy Director of the Office of Management and Budget (White) and the Director of the Office of Personnel Management (Campbell)¹

Washington, January 8, 1980

SUBJECT

• Foreign Service Pay Comparability

John and Scotty:

Following our discussion last Friday,² I asked that information be prepared here to cover some of the points that were at issue. This is reflected in the following attachments:

(1) In response to John’s inquiry about whether there was any evidence that more people were leaving the Foreign Service, I am enclosing a paper describing the definite upward trend in recent years in attrition, voluntary and otherwise.

(2) A memo on recent recruiting difficulties.

(3) Some comparisons and contrasts between the 1974 Civil Service Commission study and the 1979 Hay State and AID studies—size and choice of samples, comparative data bases, etc.—in response to Scotty’s observations.³

(4) Comments about other compensation comparisons to supplement the tables already provided showing unfavorable life time earning base compensation for Foreign Service vis-a-vis military officers and fast track Civil Service officers.⁴

(5) In response to my discussion with John about the FSO–7 to GS link point in the options identified in the interagency task force report,⁵ I am advised that Hay did not look at any FSO–7 positions; only at FSRU–7 communications specialist positions.⁶

Attachment 1

Paper Prepared in the Department of State⁷

Washington, undated

ATTRITION OF FOREIGN SERVICE PERSONNEL

There is a gradual, but clear increase in the number of separations from the Foreign Service in recent years. The increase is particularly noteworthy among that portion—FSOs and FSSs,—whose service is heavily abroad. The progression anomaly in 1978 was caused by the suspension of mandatory retirement by court order, which was reversed by the Supreme Court a year ago.⁸

If we consider voluntary departure only,—i.e. voluntary retirement or resignation,—there was a loss of 53.7% more overall officers in FY 79 than the average such loss in the years FY 1976–1978. There was an 18% increase in such loss among mid-level officers alone in FY 79 compared to the FY 76–78 average.

The following statistics cover total separations,—whether voluntary, mandatory, death or other:

TOTAL FSO, FSR, FSRU, FSS		FSO	FSS
FY 1979	9.6%	8.2%	11.0%
FY 1978	5.6%	3.8%	6.8%
FY 1977	8.1%	5.3%	11.4%
FY 1976	6.3%	4.5%	9.7%
FY 1975	7.1%	5.1%	9.7%
FY 1974	6.6%	5.6%	6.8%
FY 1973	6.9%	5.3%	7.4%
FY 1972	6.6%	4.1%	7.3%
FY 1971	5.8%	2.9%	7.6%

Attachment 2

Paper Prepared in the Department of State⁹

Washington, undated

RECENT RECRUITMENT DIFFICULTIES

Recruitment of Foreign Service personnel has become increasingly difficult recently, culminating in the formation of the January class of new FSOs, which was the most difficult to assemble in memory. Although offers were made beginning two months prior to the start of the class, the refusal rate was high. In the past the typical decline rate has been at the 50% mark, but it has now increased to a high of 61% refusal.

The precise figures for the January class are:

OFFERED	ACCEPTED	DECLINED	%age DECLINING
79	31	48	61%

When the candidates declined offers of appointment, some reasons for doing so recurred quite often. A number indicated that their decisions were based on the overall life-style of the Foreign Service. This seemed to encompass working and living overseas, working spouses, and overseas benefits.

Some claimed that our compensation package was far from competitive—indicating that they would lose between $5,000 and $13,000 a year in salary to enter the Foreign Service.

None of the candidates specifically mentioned the current Middle East situation, but the Office of Recruitment staff gained the feeling that it was a factor weighing heavily in some decisions.

1. Source: National Archives, RG 59, Records of the Under Secretary for Management (M), 1980, Box 1, Chron January 1–9, 1980. No classification marking.
2. January 4. No minutes of this discussion were found.
3. Attached but not printed is a paper entitled “Scope and Methodology of the 1974 Study by the President’s Pay Agent and the 1979 Study by Hay of Both the Department of State and AID.”
4. Attached but not printed is a paper entitled “Comparison of Lifetime Earnings of the Military, Civil Service and Foreign Service.”
5. Not found.
6. Attached but not printed is a paper entitled “The Hay Study and the ‛FSO–7’ Link.”
7. No classification marking.
8. See footnote 3, Document 130.
9. No classification marking.