Outsourcing the Government’s Most Important Functions: the Impact of Outsourcing Critical Duties on U.S. Federal Government Behavior

The levels of outsourcing in the U.S. federal government have increased substantially over the last two decades. The U.S. government now relies on outsourcing to provide many of its products and services. Prior research shows that outsourcing has a negative effect on job satisfaction in the U.S. public sector. This paper expands on that research to understand the impact of outsourcing a certain category of products and services, known collectively as nearly inherently governmental (NG) activities. This paper uses time panel analysis from 2010 to 2019 to understand the influence of outsourcing NG duties on federal employees, and the results show a statistically significant negative association. This paper also analyzes the impact of outsourcing on work intensification because outsourcing could increase the workload of the remaining employees, who are now required to execute contract management duties. This result contradicts this paper’s hypothesis and shows a marginally significant negative relationship between outsourcing and work intensification.