A parting gift from the Clinton administration leaves the new residents of the White House with an interesting problem. As a new study from the General Accounting Office reports, the federal government has lost too many employees over the last decade, or at least not enough employees are being used effectively.

From the first Bush administration to the beginning of the second, the study says, the number of federal workers fell from 2.3 million to 1.9 million because “federal employers reduced or froze their hiring efforts for extended periods. This helped to reduce their numbers of employees, but it also reduced the influx of new people with new knowledge, new energy and new ideas – the reservoir of future agency leaders and managers.” The problem will be felt more acutely in the next couple of years because 45 percent of the Senior Executive service is expected to retire by 2005.

The GAO study observes that the underlying challenge is not so much the absolute number of employees but the use of effective “human capital strategies” – good management, which has not yet received the attention of other elements in a successful organization, such as financial and information technology management and performance review. Former Vice President Al Gore’s “Reinventing Government” idea earns praise for doing some things well, but in this area anyway needed more work.

“Human capital strategies” sounds complicated, but it amounts to doing the basics: proper recruitment, training and rewards. The lack of attention in this area creates a “government-wide risk” that “urgently needs greater attention to ensure maximum government performance and accountability for the benefit of the American people.”

The GAO’s conclusions, which were made in its biannual Performance and Accountability Series and High Risk Update, are disappointing because they identify the sort of problem that might be expected in a new administration, where the rush to fill vacancies and set a new course can force good management to be ignored. But these conclusions arrive at the end of an eight-year tenure of an administration that took particular pride in its management abilities. Its crowing about a smaller government masked questions about its effectiveness.

This leaves President George Bush in an awkward spot. He cannot count on simply adding another 200,000 or 300,000 federal employees to make up in numbers what the government lacks in management skill; his party would never forgive him. Nor can he spend the first year or so of his term in a managerial role if he expects to accomplish the goals laid out in his campaign. Yet here is the nonpartisan GAO saying, “human capital shortfalls are eroding the ability of many agencies – and threaten the ability of many others – to economically, efficiently, and effectively perform their missions.”

Vice President Dick Cheney has enough on his agenda to preclude him from helping out, but a cabinet member like Labor Secretary Elaine Chao, assuming she is confirmed, might be a good choice to review the report and find ways to bring greater effectiveness to agencies without returning to the larger government of the early 1990s.