Do feds make too much money?

On Capitol Hill, lawmakers are once again delving into the perennial issue of whether federal employees make too much money.

A recent Congressional Budget Office report added fuel to the fire, with its finding that federal employees are compensated more than their private sector counterparts. CBO scored feds as, on average, earning 17 percent more in wages plus compensation than private sector employees with similar education levels.

But watchdogs say challenges in recruiting and retaining skilled workers run deeper than addressing pay.

According to the study, federal wages outpace those in the private sector for education levels up to a bachelor's degree, but for those with professional degrees or doctorates, the private sector's total compensation surges past the government's.

However, CBO made clear there are limitations to the study.

"Those estimates do not show precisely what federal workers would earn if they were employed in a comparable position in the private sector," it says.

Robert Goldenkoff, the Government Accountability Office's director of strategic issues, said at a May 18 House hearing that even if the pay system were ideal, the government faces issues with recruitment, retention and an "outmoded system that rewards length of service rather than contributions."

Joseph Kile, a CBO economist, added that the comparatively narrow range of wages in the government "might reflect constraints of the federal pay systems which make it harder for managers to reward the best performers or to limit the pay of poor performers."

Rep. Robin Kelly (D-Ill.) said these restrictions hurt the government's ability to compete with industry in high-demand fields like IT and cybersecurity. "We can't keep federal employees in the public sector because we don't pay enough," she said.

Rep. Mark Meadows (R-N.C.), chairman of the Government Operations Subcommittee of the House Committee on Oversight and Government Reform, took aim at the expensive and "archaic pension system," which he said doesn't fit "the needs of the transient millennial workforce."

Yet Andrew Biggs, a resident scholar at the conservative American Enterprise Institute, said across-the-board measures don't efficiently address the workforce's problems.

"The federal government should look to move away from the one-size-fits-all general schedule, which tries to equate dramatically different jobs on a single pay scale," he said. "Instead, Congress and the administration should work to make federal agency pay-setting more flexible to the needs of the labor market."