	Interior Continues to Face Challenges Hiring and Retaining Key Oil and Gas Staff, Primarily Because of Higher Industry Salaries and the Lengthy Federal Hiring Process

We found that Interior continues to experience problems hiring and  retaining sufficient staff to provide oversight and management of oil and  gas activities on federal lands and waters. BLM, BOEM, and BSEE office  managers we surveyed reported that they continue to find it difficult to fill  vacancies for key oil and gas oversight positions, such as petroleum  engineers, inspectors, geologists, natural resource specialists, and  geophysicists. They also reported that high rates of attrition are a  concern because some Interior offices have just one or two employees  per position, so a single retirement or resignation can significantly affect  office operations and oversight. According to Office of  Personnel Management (OPM) data, the fiscal year 2012 attrition rate for  petroleum engineers at BLM was over 20 percent, or more than double  the average federal attrition rate of 9.1 percent. Interior officials cited two major factors that affect the agency’s ability to  hire and retain sufficient staff to oversee oil and gas activities on federal  leases:
Higher industry salaries. Bureau of Labor Statistics  data confirm that there is a wide and growing gap between industry  and federal salaries for some positions, particularly petroleum  engineers and geologists. However, all hiring times were much longer than 80 calendar days— OPM’s target. According to BLM, BOEM, and BSEE officials, other factors have  contributed to difficulties hiring and retaining key oil and gas oversight  personnel, such as few qualified applicants in remote areas, or areas with  a high cost of living. Interior Has Taken Some Actions to Address Hiring and Retention Challenges

Interior and its three bureaus—BLM, BOEM, and BSEE—have taken  some steps to address hiring and retention challenges but could do more. Interior has used special salary rates and incentives to increase hiring  and retention for key oil and gas positions, but use of these incentives  has been limited. Interior has taken some steps to reduce the time it takes  to hire oil and gas oversight staff but does not collect data to identify the  causes of delays in the hiring process and opportunities for reducing  them. BLM, BOEM and BSEE have the authority to pay incentives in  the form of recruitment, relocation, and retention awards of up to 25  percent of basic pay, in most circumstances, and for as long as the use of  these incentives is justified, in accordance with OPM guidance, such as in  the event an employee is likely to leave federal service. BLM awarded two of  the four retention incentives in 2012 to help retain petroleum engineers in  its North Dakota Field Office. However, neither the  department nor the three bureaus have complete and accurate data on  hiring times that could help them identify and address the causes of  delays in the hiring process. For instance, BSEE and BOEM collect hiring  data on a biweekly basis, but officials told us they use the data primarily  to track the progress of individual applicants as they move through the  hiring process. Likewise, a BLM official stated that the bureau does not  systematically analyze data on hiring times. Without reliable data on  hiring times, Interior’s bureaus cannot identify how long it takes to  complete individual stages in the hiring process or effectively implement  changes to expedite the hiring process. Hiring and Retention Challenges Have Made it More Difficult for Interior to Carry Out Some Oversight Activities

The BLM, BOEM, and BSEE officials that we interviewed and surveyed  reported that hiring and retention challenges have made it more difficult to  carry out their oversight activities. These officials stated that position  vacancies have resulted in less time for oversight, and vacancies directly  affect the number of oversight activities they can carry out—including the  number of inspections conducted and the time for reviewing applications  to drill. Officials at each of the three bureaus cited steps they have taken to  address vacancies in key oil and gas positions; specifically, reassigning  staff from lower-priority to higher-priority tasks, borrowing staff from other  offices, or increasing overtime. In response  to this recommendation, in fiscal year 2011, BLM implemented a risk- based inspection strategy whereby each field office inspects the highest  risk wells first. In our January 2014 report, to address the hiring challenges we identified,  we recommended that Interior explore its bureaus’ expanded use of  recruitment, relocation, retention, and other incentives and systematically  collect and analyze hiring data. Interior generally agreed with our  recommendations.
Why GAO Did This Study

Interior employs a wide range of highly trained specialists and scientists with key skills to oversee oil and gas operations on leased federal lands and waters. GAO and others have reported that Interior has faced challenges hiring and retaining sufficient staff to carry out these responsibilities. In February 2011, GAO added Interior's management of federal oil and gas resources to its list of programs at high risk of fraud, waste, abuse, and mismanagement in part because of Interior's long-standing human capital challenges.
This testimony and the January 2014 report on which it is based address (1) the extent to which Interior continues to face challenges hiring and retaining key oil and gas staff and the causes of these challenges, (2) Interior's efforts to address its hiring and retention challenges, and (3) the effects of hiring and retention challenges on Interior's oversight of oil and gas activities. To do this work, GAO surveyed all 44 Interior offices that oversee oil and gas operations, of which 40 responded; analyzed offshore inspection records and other documents; and interviewed agency officials.

What GAO Found

The Department of the Interior continues to face challenges hiring and retaining staff with key skills needed to manage and oversee oil and gas operations on federal leases. Interior officials noted two major factors that contribute to challenges in hiring and retaining staff: lower salaries and a slow hiring process. In response to GAO's survey, officials from a majority of the offices in the three Interior bureaus that manage oil and gas activities—the Bureau of Land Management (BLM), the Bureau of Ocean Energy Management (BOEM), and the Bureau of Safety and Environmental Enforcement (BSEE)—reported ongoing difficulties filling vacancies, particularly for petroleum engineers and geologists. Many of these officials also reported that retention is an ongoing concern as staff leave for positions in industry. Bureau of Labor Statistics data confirm a wide gap between industry and federal salaries for petroleum engineers and geologists. According to Office of Personnel Management (OPM) data, the fiscal year 2012 attrition rate for petroleum engineers at BLM was over 20 percent, or more than double the average federal attrition rate of 9.1 percent. Field office officials stated that attrition is of concern because some field offices have only a few employees in any given position, and a single separation can significantly affect operations. Additionally, Interior records show that the average time required to hire petroleum engineers and inspectors in recent months generally exceeded 120 calendar days—much longer than OPM's target of 80 calendar days.
Interior and the three bureaus—BLM, BOEM, and BSEE—have taken some actions to address their hiring and retention challenges, but they have not fully used their existing authorities to supplement salaries or collect and analyze hiring data to identify the causes of delays in the hiring process. For instance, BLM, BOEM, and BSEE officials said that recruitment, relocation, and retention incentives are key options to help hire and retain staff, but the bureaus' use of these incentives to attract and retain petroleum engineers and inspectors has been limited for various reasons. Moreover, Interior and its bureaus have taken some steps to reduce hiring times, but they do not have complete and accurate data on hiring times. For instance, while BSEE and BOEM collect hiring data on a biweekly basis, the data are used primarily to track the progress of individual applicants as they move through the hiring process. Likewise, a BLM official stated that the bureau does not systematically analyze data on hiring times. Without reliable data on hiring times, Interior's bureaus cannot identify how long it takes to complete individual stages in the hiring process or effectively implement changes to expedite the hiring process.
According to BLM, BOEM, and BSEE officials, hiring and retention challenges have made it more difficult to carry out oversight activities in some field offices. For example, many BLM and BSEE officials GAO surveyed reported that vacancies have resulted in a reduction in the number of inspections conducted. As a result of these challenges, bureau officials cited steps they have taken to address vacancies in key positions, such as borrowing staff from other offices or using overtime, but these are not sustainable, long-term solutions.

What GAO Recommends

In its January 2014 report, GAO recommended that Interior explore its oil and gas management bureaus' expanded use of recruitment, relocation, retention, and other incentives and systematically collect and analyze hiring data. Interior generally agreed with GAO's recommendations. GAO is not making any new recommendations in this testimony.