The Bureaucratization of the Federal Government in 20 charts

Last updated: May 22

If you've been following my work, you know that I've long been concerned about the steady bureaucratization in the U.S. economy. Lately, my focus has shifted to understanding how this trend is sapping the vitality of public institutions and, more importantly, what can be done to reverse it.

I plan to dig deeper on these topics in the coming months. For now, I'd like to share some facts on the growth of administrative occupations and management roles within the federal government. Workforce shifts don't paint the entire picture, but they serve as useful proxies of bureaucratic drag. Typically, more managers and administrators means more layers, silos, rules, and processes.

The data comes from the Office of Personnel Management (OPM), which graciously worked with me to assemble together a granular dataset on the federal workforce over time (a great example of responsive government, by the way).

Before we dive in, a few caveats. These numbers exclude military, foreign service, intelligence personnel, the Postal Service, and government executives (though my last chart will touch on this final group). They’re also preliminary calculations, so they should be interpreted with that in mind.

With those qualifiers out of the way, let's jump in!

ONE. Administrative roles represent the largest occupational category in the federal government. There are nearly 900,000 people working in administrative jobs out of 2.2 million total federal employees. That's 41% of total full-time employment in Federal Agencies, up from 31% in 1998.

TWO: The largest group of administrative occupations is investigation and other compliance jobs, which include FBI agents, U.S. Immigration and Customs Enforcement, and similar roles (120,000 full-time employees). Program Management and General Administration & Program each have around 110,000 people. IT accounts for about 97,000, while Legal and Contracting together make up another 83,000. Finance and HR occupations have 55,000 and 43,000 employees, respectively.

Many federal employees working in legal, contracting, and finance-related jobs are counted as "professional" rather than administrative, and aren't included in the numbers so far. Adding these admin-adjacent occupations (the purple bars in the chart) pushes the total to nearly one million people in 2023, or roughly half of the full-time federal workforce.

THREE: Employment in administrative occupations has expanded steadily over the last 25 years.

The bulk of the increase has come from three agencies: the Department of Defense (DoD), the Veterans Administration (VA), and the Department of Homeland Security (DHS). Several factors are driving this growth, including post-9/11 increases in defense spending and overseas deployments, the ongoing expansion of the VA (which is correlated with DoD activity), and the creation of DHS as a new department. DHS absorbed employees from Treasury (e.g., Customs and Border Protection) and the Justice Department (Immigration and Naturalization Service), and also hired thousands of Transportation Security Administration (TSA) airport screeners.

But even when you exclude DoD, DHS, and the VA (as well as the Treasury and Justice Departments given their employee transfers to DHS in the 2000s), the share of administrative employment is up by eleven percentage points—from 35 to 46%.

FOUR: In fact, administrative growth is a pervasive trend. This chart shows the steady upward trajectory in the relative share of admin employment across several agencies:

FIVE. In real terms, Federal spending per administrator has stagnated or declined in the last decade or so (depending on what definition of spending one uses, and excluding the Covid spending bump). This suggests that even where administrative growth is driven in part by increased spending (e.g., grants or contractors), there are no administrative economies of scale. More takes on this in subsequent charts.

SIX. Employment in the "core" admin and admin-adjacent functions–Program Management, Other Admin & Program, HR Finance, and Legal & Contracting– has nearly doubled over the last 25 years, compared to 30% growth for overall federal employment.

SEVEN. In contrast, STEM employment has grown far more slowly or stagnated: Over the last 25 years the federal government created over 60,000 program management roles, while only adding 20,000 engineers and scientists.

EIGHT. Here's another cut: there are now nearly 300,000 program managers, finance administrators/analysts, lawyers and contracting professionals working for the federal government, compared to fewer than 200,000 scientists and engineers.

NINE. This trend is evident across nearly all agencies that rely on STEM talent. Here's the data for the National Institutes of Health (NIH), the Food and Drug Administration (FDA), the National Science Foundation (NSF), the Centers for Disease Control (CDC), DoD's central units (i.e. excluding Air Force, Army, and Navy staff), as well as NASA.

TEN. In agencies like the NIH and NSF, the growth in core administrative, financial and contracting occupations has outpaced increases in funding (which has gone up 2 and 1.7x in this period, respectively). Again, there’s no sign of administrative economies of scale—in fact, quite the opposite.

ELEVEN. Let’s extend this analysis to the Department of Defense (DoD), the federal government's leading employer of program managers, contracting officers, legal professionals, and financial administrators. Procurement and R&D dollars spent per employee in these occupations has declined (in real terms) over the last decade.

TWELVE. The declining ratio of spending dollars per admin in recent years is driven by staffing increases in the face of lowered spend. Employment in core admin occupations kept up with the increased defense spending post-9/11. But as spending wound down, employment kept expanding (especially for program managers).

THIRTEEN. Employees in administrative occupations are much more likely to be promoted to a higher General Schedule grade than others.

Each dot in this chart represents the average promotion rate by occupational group in a particular year for all government agencies with at least 5,000 employees.The box plots show the median (as well as the first and third quartile) promotion rate across all dots for each occupational group. Over the last 25 years, the median promotion rate to a higher grade for administrators has been 16.5%, compared to 12% for professionals. The inevitable byproduct of this differential is that administrators become more senior–and influential--than their colleagues (more on this below).

The next set of charts examines trends in the managerial and supervisory workforce. (Note: this analysis excludes the VA, as the supervisory role data for that agency looks inconsistent over time).

FOURTEEN. Over the past 25 years, the number of managers and supervisors has grown faster than other occupational categories. There was a surge in management roles in the 2007-10 period, likely driven by increases in employment at the DoD and DHS described in the commentary to chart 3.

FIFTEEN. The trend toward a more management-heavy workforce is widespread, with many agencies seeing a 5-7 percentage point rise in the employment share of of supervisors and managers over the last 25 years.

SIXTEEN. As a result of this managerial growth, the span of control has dropped by a nearly quarter. The declining trend is little changed when excluding the Department of Agriculture, which reported a surge in managers in 2010 (hence the steep drop in the blue line right around that time).

SEVENTEEN. Dollars of spending per manager and supervisor have remained stagnant or declined over the last 15 years, depending on the category of spend (and discounting the pandemic-related spending hike). As with administrators, there are no real managerial economies of scale.

EIGHTEEN. Managers and supervisors are promoted at higher rates relative to other federal employees. The median differential is about 1.5 percentage points across the 1998-2023 period.

NINETEEN. Given the higher promotion rates of both managers and administrators (Chart 13), it's not surprising that the federal government has a lot administrative managers. They now make up 57% of supervisory positions, up from 48% in 1998.

Although the OPM dataset doesn't provide details on the hierarchical level of people in management roles, it's reasonable to assume that the more senior managers are, the more likely they are to be administrators.  That's the impression one gets when examining the growth in employment among the top grades of the General Schedule (GS 13-15). Between 1998 and 2023, the number professional staff in those grades doubled from approximately 96,000 to 181,000. In contrast, the number of senior administrative staff tripled from 103,000 to 309,000.

TWENTY. The preceding charts do not include executive positions, but New York University's Paul Light estimated that the number of organizational layers among the most senior roles in the largest federal agencies has grown nearly fivefold since the 1960s. As of Light's latest counting in 2020, there are 1,070 deputy assistant secretaries, 236 assistants to the assistant secretary, 204 deputy deputy assistant secretaries, and 153 deputy assistant assistant secretaries. You can explore the plethora of positions here. (If you filter by level, keep in mind Level I is the highest, assigned to head of large agencies or departments).

Why is this happening?

Fully doing justice to this question is a topic for another day. But let's consider a five explanations for why the ranks of administrators and managers are expanding across federal government, beyond the obvious shifts I've already noted like increases in spending, the creation of new departments like DHS, etc:

Hypothesis 1: More complex work

Some might contend that the proliferation of administrators and managers is a natural outgrowth of an increasingly knowledge-driven economy. As routine clerical and technical tasks are automated, the argument goes, a larger share of the remaining workforce is engaged in skilled, judgment-based work that demands greater coordination and "coaching" from experienced managers.

This view fails to explain why administrative employment has outpaced growth in high-skilled professional roles in engineering and science occupations (see chart 7). It's also far from self-evident that a knowledge economy requires more support staff, managers, and layers. Indeed, thinkers like Peter Drucker have made the opposite case (as have we!). Large organizations as diverse as Haier (appliances) and Buurtzorg (health care) show that it's possible to be highly effective and efficient with super-lean administrative functions and minimal hierarchy.

More layers and process is the prevailing response for handling complexity at scale for a number of reasons: it's what most other large institutions do, so it's viewed as inevitable; it's the typical "best practice" prescription from consulting firms and professional schools of business and public administration; and it conforms with expectations of regulators who mistake the trappings of bureaucracy–a chief compliance officer, compulsory training, comprehensive reporting–for true accountability and control. But it's definitely not the only response available, and almost surely not the best one.

In fact, there’s little evidence that more federal administrators and managers translate into improved organizational effectiveness. In fact, a 2015 paper by researchers at Duke, Princeton, and Vanderbilt found that increased numbers of administrators were actually associated with lower performance, measured by agency scores on the Performance Assessment Rating Tool, or PART. PART was developed by the Office of Management and Budget during the George W. Bush administration and has since been discontinued, so this isn't conclusive evidence. But it's consistent with multiple other data points. For instance, the CDC and FDA didn't exactly knock it out the park in the early stages of the pandemic (see for instance here, and here), despite employing 2,250 more program managers, public health program specialists, and general administrators than in 2010 (a 50% increase).

Hypothesis 2: Title and grade inflation

Job changes within the federal workforce could explain some of the growth in administrative positions, especially when white collar support roles (which the Office of Personnel and Management defines as "Technical") are reclassified into administrative ones, as seems to happened with roles like Tax Specialist. Alternatively, people could be switching from technical occupations to adjacent administrative roles (e.g., from Legal Assistant to Paralegal Specialist).

The same paper I cited earlier about the link between administrative growth and performance also looked at this dynamic, and found some evidence that these shifts are happening, especially among younger and relatively more educated technical workers. But the effect is modest, especially for the "core" admin jobs we're concerned with. For instance, only 17,000 employees made the move from the technical "General Clerk and Assistant" role to "General Administration and Program" over 23 years (1988-2011).

The DoD's conversion of military into civilian jobs between 2004 and 2010 is another factor to consider. The Congressional Budget Office (CBO) notes that this added 32,000 civilian roles (the General Accounting Office reports that in this period some contractors also became permanent staff, though it's not clear whether these are in addition to the 32,000 new roles mentioned by the CBO). We don't have a clear breakdown of what jobs former military or civilian contractors moved into, but even with the generous assumption that two-thirds of the "civilianized" positions were administrative, that amounts to only 21,000 jobs. That's about a third of the admin growth that time period, and less than a fifth of the total expansion of the administrative ranks between 2004 and 2023. This influx might explain some, but certainly not the majority, of the dynamic (and it certainly doesn't account for any of the administrative growth outside of DoD).

For managers and supervisors, grade creep is likely inflating the count. A report by the Merit System Protection Board makes the point that a supervisor’s grade is pegged to the grade of their subordinate: in other words, the more high-level people you oversee, the higher your status (and the bigger your salary). This creates a powerful incentive for agencies to shift certain employees into managerial roles. I'm sure that in many cases this is a well-intentioned attempt at rewarding and retaining capable employees, given the lack of viable alternatives. But this is hardly the best way to recognize contribution.

Hypothesis 3: More contract work

NYU’s Paul Light and others have documented the federal government's greater reliance on private sector contractors, state and local governments, and other third parties to carry out its functions. This can create additional administrative work for the permanent workforce—setting requirements, drafting contracts, ensuring compliance, and reviewing performance.

There are several reasons behind the federal government's embrace of contracting: a sluggish hiring process, skills gaps in critical occupations, political pressure to limit the size of the federal workforce, and a belief that offloading work to third parties improves efficiency and flexibility. Unfortunately, this "asset light" strategy doesn't always pay off, since it can erode institutional knowledge and practical expertise. There are several examples of this in the public sector, which are wonderfully documented by Jen Pahlka (founder of Code for America and U.S. Deputy Chief Technology Officer during the Obama Administration) in her excellent book, Recoding America. This pervasive trend also affects the corporate sector (just look at Boeing).

The contracting explanation has some merit, but it doesn't account for the growth in administration and management over the last decade, as contract work has stabilized or even declined in real terms. Consider again the DoD data in Chart 11: procurement spend is currently in at 2007 levels, yet the number of program managers has increased by 60%.

Hypothesis 4: Increased legalism

There's a growing consensus that America's legal framework for government action relies excessively on prescriptive rulebooks and formal procedures, and subjects agencies to layers upon layers of challenges and review. It's no wonder we often get inflexible policy making and slow and kludgy implementation (the National Environmental Policy Act, or NEPA, is a good example). Philip K. Howard has long made this argument (for instance, here and here), along with other voices across the political spectrum like University of Michigan's Nicholas Bagley and Niskanen's Brink Lindsey.

It's easy to see how a legalistic approach to policy making and execution can lead to more administrative staff. Agencies need more lawyers to anticipate or respond to risks and more contracts officers to ensure agreements are properly formulated (consider that there are over 2,000 pages in the Federal Acquisitions Regulations manual). This might explain why employment in legal and contracting roles grew more than twice as fast as the federal workforce over the last 25 years.

On the other hand, many of the legal changes in question happened in the 1960s and 1970s, well before the time frame of our analysis (another bastion of legal proceduralism, the Office of Information and Regulatory Affairs or OIRA, was established in 1980). The raft of regulations also seems to have slowed down since those days. For instance, the number of final rules published in the Federal Register (the government's official publication for rules, executive orders, and notices) in 2023 was 2,803, 40% lower than in 1998 and 65% lower than 1980. A Congressional Research Service report finds that the number of "major" rules that need to be reviewed by Congress (such as those having an impact in excess of $100 million) oscillates in the 60-80 range for most years between 1997 and 2018. Also keep in mind that legal and contracting personnel has kept expanding even as contact spend (and presumably the number of contacts and related legal matters) has plateaued and even declined in the case of the Department of Defense (see charts 11 and 12).

This isn't to say that overbearing legalism isn't a problem or to discount the pernicious effect of a steady stream of rules sedimenting over time. But my best guess is that the impact is more indirect–and reciprocal. As Philip Howard observed, the prevailing statutory and regulatory paradigm was inspired by bureaucratic principles like standardization (uniform and precise rules) and formalization (clearly circumscribed and fixed roles). It's therefore not surprising that a legal framework informed by bureaucracy provides fertile soil for bureaucratic management practices. And this brings us to the final hypothesis...

Hypothesis 5: Bureaucratic capture

Expansion in management and administration is the inevitable outcome in organizations that are run with a bureaucratic operating system. Here are the defining elements of that model:

As bureaucratic organizations become larger and older, they're subjected to a well-known set of dynamics that generate more managers, administrators, and rules. Let's review some of the most important ones:

• When the organization expands, layers get added and the ratio of managers to front-line staff goes up. Over time, the proportion of employees who have a direct customer-facing role goes down. As Mark Zuckerberg recently wrote, you end up with “a management structure that's just managers managing managers, managing managers, managing managers, managing the people who are doing the work.”
• In most organizations, your power and compensation are the product of headcount and budget. The tendency is therefore to find all sorts of reasons to expand both. No one ever downsizes their empire voluntarily, either. This explanation is consistent with managerial grade inflation (see Hypothesis #2).
• Internal boundaries multiply and become more rigid over time, creating the need for roles and processes for obtaining approvals and coordinating action. For a great real-world illustration, see this quote from a Defense Business Board report on program managers:

      Many DoD program managers, senior officials, and others who were
     interviewed believe that PMs spend the majority of their time going from
      meeting to meeting and answering the same questions amongst
     the various offices. PMs spend too much time managing the politics and
     the “process” within DoD rather than managing their specific program.

• Powerful staff groups blanket the organization with policies and rules, which typically don’t a sunset clause. As a result, the clog of red tape grows ever bigger. Moreover, internal service providers can’t be fired by their so-called customers, which means their incentives for improving the efficiency and quality of their offerings are muted. (Note: It's undoubtedly true that external factors, in this case guidance from Congress and the White House, often drive the creation of new positions and oversight requirements. But in my experience, the majority of process and rules are generated internally).
• Every new challenge begets a new CxO or head office unit. These soon become permanent fixtures. Similarly, authority moves to the center during a crisis– and stays there.
• Finally, an administrative aristocracy emerges. What often distinguishes senior people from frontline colleagues is not creativity, foresight or technical expertise, but mastery of administrative arcana—how to develop a plan, set performance goals, build a budget, interpret financial results, coordinate a project, conduct a performance review and give employee feedback. An organization that selects for these skills will, over time, become dominated by administrators.

The last item is subtly related to the hollowing out of expertise in government (Hypothesis #3). Administrators will have a penchant to solve problems via administrative solutions. For instance, when faced with a challenge that requires deep engineering or software development capabilities, decision-makers who lack technical expertise might prefer outsourcing the work to outside of contractors. It's just easier to model the project in a spreadsheet and send it out for bids than to wrangle a team of "geeks."

An increasingly influential administrative class, likely composed of people who got ahead by not rocking the boat, will also tend to favor narrow interpretations of existing rules and regulations (Hypothesis #4), thereby creating more inflexibility and conservatism. Pahlka provides a perfect illustration of this in Recoding America, when observing that existing pathways to expedite procurement decisions are largely ignored because of "a culture in which if even one person prefers safe over sorry, we’re back to the way it’s always been done."

As these dynamics play out over time, the end result is not only managerial and administrative overhead but also reduced vitality – daring, resilience, creativity, and engagement. Bureaucratic institutions have a tendency to ossify, as RAND's Michael Mazarr aptly puts it.

More to come on this front. In the meantime, I'd love to hear your thoughts:

• Which of these data is most surprising? Most concerning?
• How do these trends jibe with your own experiences in government or other large organizations?
• Which explanations are most convincing? Are there others you’d add?
• What am I missing?

I'm eager to get your take in the comments section. Alternatively, feel free to reach me at michele[at]managementlab.org.