Key findings for 2004–05
Thanks to the annual surveys, we now have the foundations of significant time series data sets for both the employee and agency surveys to consider alongside the Australian Public Service Employment Database (APSED) data on trends in demographic and structural change in APS employment. Read together, the trend data sheds considerable light on critical workforce planning requirements in the public service and how to go about addressing them.
Maintaining and sustaining the APS workforce
It is clear that, following two decades of reform, the nature of APS work has changed. There has been a major reduction in opportunities for low-skilled employment in response to factors such as technological change, corporatisation, outsourcing and the transfer of some functions to other jurisdictions. The APS 1–2 equivalent classifications—52% of the APS workforce in 1980—have fallen to only 5.2% today. The streamlining and broadbanding of classification structures in the APS and the opening-up of APS employment to external competition have seen new recruits to the public service, many with skills and experience in other sectors, typically commencing at the APS 3–4 classifications or higher and advancing fairly rapidly to higher levels.
The APS is now a graduate workplace, with APS employees at all levels increasingly likely to hold tertiary qualifications, regardless of whether they are recruited through graduate entry programmes or general recruitment processes—almost half of our workforce has graduate qualifications, as do around two-thirds of new recruits.2
The skills requirements of APS agencies are growing at a time that the labour force is contracting. Older workers are leaving and there are fewer young workers to replace them. It is not surprising, therefore, that the most common workforce challenge identified by agencies in response to our survey was difficulties in recruiting people with required skills, and the second most common challenge was ensuring that employees’ skills and/or knowledge meet agency requirements (see Chapter 8, ‘Managing, Sustaining and Engaging the APS Workforce’).
While our skills requirements are expanding against a contracting labour market, many agencies are operating within tight resource constraints. The overall productivity gains required to be made by APS agencies by the current funding arrangements are quite substantial (see Chapter 5, ‘The Values and Workplace Relationships’). A number of small agencies have raised individual concerns about their capacity to maintain competitive pay rates. We tested these concerns through our agency survey against agency quartile rankings for base salary and total reward, and found that while small agencies are consistently at the lower end of the salary scale for most classifications, the pattern is not clear-cut. Nevertheless, it is reasonable to assume that in a tightening labour market small agencies may begin to experience difficulties in matching the market rates for the skills they need.
These constraints mean that agencies will have to be more strategic about the measures they adopt to attract and retain the skills they require. We know from a range of sources that agency progress towards systematic and long-term workforce planning has so far been patchy. In its most recent report, Managing and Sustaining the APS Workforce, MAC called for agencies to focus more urgently on the work they have been doing to establish processes for systematic workforce planning—including identifying new skill requirements for policy and programme development—and how they intend to respond to their longer-term resource requirements.
Agencies should also be paying attention to how they are going with the employment of those groups now shrinking as a proportion of the APS workforce—younger people without post-school qualifications, Indigenous people and people with a disability. Where it would be of use, agencies should be exploring base-level recruitment pathways such as apprenticeships, traineeships and/or other recruitment strategies targeted at increasing our recruitment of these groups, including looking at how we can improve the diversity of our workforce—especially Indigenous people and people with a disability.
However, this is not just about individual agencies. MAC has established an agenda that will engage a number of agencies and the Commission working in their areas of expertise to map out recruitment, retention and development strategies for use by all APS agencies.3 MAC itself will monitor agency progress in implementing effective workforce planning and strategic resourcing initiatives.
It is critically important to ensure that we are developing the next generation of leaders to replace the large number of baby boomers who are leaving the public service and will continue to do so over the next two decades. People are getting to senior public service positions much sooner than they once did, and may not necessarily have had the experience and development opportunities that their predecessors did. I am particularly concerned by the relatively low proportion of public servants who felt able to rate their supervisor highly in the area of ‘shapes strategic thinking’ (47% of APS, 52% of Executive Level (EL)1s and 58% of EL2s and above—overall, 48% in 2004–05, similar to the 2003–04 result) (see Chapter 10, ‘Leadership, Learning and Development in the APS’). This is an area on which agencies, members of the Senior Executive Service (SES) and those who want to enter the SES should focus, through, for example, more concentrated policy development work and training.
I am worried by our declining rates of interagency mobility. APS-wide workforce data shows that the new generation of public servants at the executive level contains more and more people who have either come straight into the APS from somewhere else, or who have spent 5–10 years working in only one agency. These people often will not have achieved the depth and breadth of understanding of the Values and the Cabinet, judicial, legislative, finance and parliamentary processes, agency-specific cultures, styles of working, people management and other arrangements that make for effective whole of government collaboration. How can they fully appreciate the work demands, issues and requirements of other agencies? Again, I would exhort both agencies and relevant individuals to attend closely to the mobility initiatives being sponsored as part of the MAC strategy.
Employee engagement data
It is also important to look inwardly as well as outwardly in order to ensure that we are making the best use of the people we have and those we are looking to recruit.
Time series data suggests that there has been a slight downward trend in employee data in a number of indicators that cluster around workplace relationships. Compared to 2003–04, public servants were somewhat less likely to feel that merit processes have been applied; less satisfied with the consultative mechanisms in their workplaces; less satisfied with their overall say in decisions that impacted on their work; and less likely to agree with most of the effectiveness indicators describing the impact of their agency’s performance pay system.
Situations outside the control of agencies may also have influenced these results, for example machinery of government changes following the election, and the public debate on relationships between the public service and Executive government on several fronts.
However, these remain important indicators because, real or otherwise, perceptions have an impact on the level of our employees’ engagement with their work and, through that, with their longer-term productivity.
Employee engagement gives us a good understanding of employees’ commitment to their agency, and is an indicator of how hard they work and how long they will stay with their organisation. Overseas research as well as our own State of the Service data suggests that organisational culture and leadership have a much greater impact on employee engagement and productivity than do other factors.
This year we introduced a series of questions aimed at establishing employees’ commitment to working in their agencies and for the APS. Most APS employees (60%) identified themselves primarily with their agencies and 40% with the APS as a whole. Most (two-thirds) agreed that they were proud to work in their current agency and significantly more were proud to work in the APS. This is a good result.
Not surprisingly, we found that APS employees’ pride in their agency was positively correlated with their views on whether the agency itself had achieved its stated objectives over the last 12 months, and overall, two-thirds agreed that it had. Importantly, the meeting of agency objectives and growth in personal productivity were also positively correlated: those APS employees who thought their productivity had increased markedly or somewhat over the last year were also more likely to agree that their agency had achieved its stated objectives.
Those employees who indicated that their productivity had increased in the last 12 months also identified the five key factors that increased their productivity. Most indicated that they had been helped by increased experience on the job. Good working relationships were also very important to them (this result is confirmed in the job satisfaction results). Beyond these two factors, employee data suggests that the manager is a critical conduit in the process of engaging and retaining employees and increasing productivity. APS employees pointed to good working relationships with their managers; access to the information, resources and/or technology they needed to do their jobs; and working to realistic performance expectations—all managerial responsibilities—and to having a manager who encourages and manages innovation. Conversely, poor management was among the top reasons that employees intended to leave the APS.
One of the more interesting findings in the area of employee engagement is that only 4% of employees who felt their productivity had improved, rated access to performance-related pay as one of the top five factors that helped to bring about that improvement. Combined with the other results, this result indicates that there are other more important factors than pay motivating APS staff. International research (summarised in Chapter 8) has reproduced this finding though it is important to point out that the research also found financial incentives to be linked to the attraction and retention of employees.
A number of critical indicators of employee engagement that have been identified and defined through research are considered at length in different parts of this report, including:
- communication
- a reputation for integrity
- equity and recognition
- diversity
- access to learning and development.4
As noted above, our data has indicated that there has been a small, but statistically significant, fall in some of these measures. Each of the measures is closely linked to one or more of the Values. I intend to continue to focus on these areas in future reports.
2 The method used to calculate the proportion of employees with graduate or tertiary qualifications includes those with qualifications at bachelor degree and above. It excludes from the denominator those for whom no data was provided by agencies, and those who chose not to provide details of their highest educational qualification.
3 Management Advisory Committee 2005, Managing and Sustaining the APS Workforce, Commonwealth of Australia, Canberra. See Chapter 6.
4 The Corporate Leadership Council surveyed 50,000 employees worldwide (including in Centrelink) to identify the cultural traits that have the maximum impact on employees’ engagement with their organisations (see Chapter 8).
