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Key developments in the world of federal employee benefits: health, pay, and much more.

Generation Gap

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Ever since the advent of the teenager in the 1920s, Americans have loved parsing generation gaps, whether flappers complaining about their unhip parents, post-war patriots lamenting the behavior of their baby boomers-turned-hippies, or those boomers bemoaning the apathy of their teenagers. Quite often, that wailing and gnashing of teeth is silly and ultimately harmless.

But when it comes to handing off federal departments and agencies from one generation to the next, it's important not to give too much credence to stereotypes about age groups, especially when making pay and benefits policy. A recent study by the Merit Systems Protection Board suggests that the next generation of federal workers isn't so different from the ones that preceded it, and that in an uncertain economic climate, the federal government's traditional steady pay, job security and quality benefits might be more important to young workers than ever before.

"Much of the generational literature suggests that younger employees are less interested in structured, traditional benefits (such as insurance and retirement) and more interested in alternative benefits (such as alternative work schedules and telecommuting)," MSPB wrote. "However, when comparing the responses of the under-30 to those of the 30-and-over new hires, we found that there was actually little difference between the two groups -- and some traditional benefits were actually more important to younger new hires."

In particular, younger workers told MSPB that health insurance mattered. A whopping 96 percent of them said it was important to them when considering job offers, compared with 79 percent of workers 30 and older. That 17-point gap was the largest division between the two age groups, followed by pensions, which was important to 10 percent more of older new hires, and tuition reimbursement, which was important to 8 percent more of younger workers.

The generational reasons for the gap in preferences for pensions and tuition reimbursement are fairly transparent. Younger workers are more likely to have outstanding student loans. Older workers are more likely to be focusing on retirement.

But health insurance is an area in which young people are more likely to have experienced economic insecurity than their predecessors. In the most recent Current Population Survey, in 2004, Americans between the ages of 18 and 34 represented 25 percent of the total population but 41 percent of the total uninsured. In contrast, Americans between 35 and 64 represent 28 percent of the population

In a survey commissioned by the Change to Win labor federation in December 2007, 48 percent of respondents said they thought children would be economically worse off in adulthood than adults are today.

Is it any wonder that young workers-facing an economy in which fewer employers offer decent health insurance, defined-benefit pensions are heading rapidly toward extinction, and threats of a larger downturn and a slide in global prominence overshadow the workforce -- turn to the federal government for the promise of security?

It's more surprising, and worrisome, that government might not recognize those larger trends and that reality. Agencies can find many good reasons to develop alternative benefits such as telework; the environmental and financial costs of commuting also are looming trends. But to assume that those alternatives can trade off with more concrete and traditional benefits such as good pay and health insurance would be a grave error. The government might have a better reputation among young workers than it realizes. It should not sacrifice that reputation because of faulty generational assumptions.

 
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