April 1, 2004The Securities and Exchange Commission has yet to fill hundreds of new staff positions created by a substantial budget boost it received more than a year ago, SEC Chairman William Donaldson told a House Appropriations subcommittee Wednesday.
Testifying on President Bush's fiscal 2005 budget request, Donaldson said the SEC currently has 525 vacant staff slots, and about 100 of those positions will be filled by the end of May. He said he expects to fill the remaining 425 vacancies by the end of the current fiscal year.
About 150 of the slots are for attorneys, and about 125 are accountant positions with starting salaries of about $70,000, according to Donaldson. He said a senior-level SEC accountant with 20-25 years' experience could earn an annual salary of more than $186,000.
House Commerce-Justice-State Appropriations Subcommittee Chairman Frank Wolf, R-Va., said he was "shocked" the SEC has not yet found enough "high-quality, capable" people to fill those jobs.
"I'm surprised that you're having trouble," Wolf said. "What you're doing is really exciting, it's important, it's public service, and that's a good salary ... I think there's something wrong, and I'm not really quite sure what it is."
Donaldson said recent salary increases, employee benefit enhancements and other changes have enabled the SEC to retain more employees than it had typically retained before the budget boost. He said the commission's turnover rate has dropped from 8 percent in FY01 to 1.5 percent in fiscal 2003.
"Notwithstanding improvements in retention, we continue to have vacancies," Donaldson said. He said recruiting qualified accountants to fill new jobs at the SEC has been particularly difficult, partly because private-sector accounting jobs in the Washington, D.C., area offer substantially higher salaries. The commission also is seeking accountants with a "very high level of accomplishment," Donaldson said.
"We have refused to hire employees simply to fill chairs, but rather are focused on hiring the best and most appropriate people to fill these important positions and are keenly focused on where each staff person can do the most good," Donaldson said.
In the meantime, the SEC also has increased the number of examiners, supervisors and support staff involved in the oversight of the $7 trillion mutual fund industry, from about 370 staff members to nearly 500.
"With this staffing increase, the SEC has increased the frequency of examinations of [mutual] funds and advisers posing the greatest compliance risks and is conducting more examinations targeted to areas of emerging compliance risk," Donaldson said.
But Wolf noted many people are "knocking down the doors to work for the FBI" and wondered why the SEC has not inspired the same response. "This is not just working on somebody's books," Wolf said. "This is really important stuff."
Wolf asked Donaldson to provide the subcommittee with job descriptions and other information about all the positions the SEC is seeking to fill. "Perhaps we could circulate that [information] and be of some help," Wolf said.
April 1, 2004