Federal or Private Sector Employment: Which is Better?

Jul 20, 2017


Some federal employees may consider leaving the federal government if certain proposed changes to retirement and benefits occur. Depending on your current situation, this may be a smart move. And for others, it may not be. Below are some things to consider if you are not yet eligible to retire from federal service but are wanting to leave.

Job Security

Federal government jobs generally have more job security than private sector ones. There are rules designed to protect federal employees such as RIF procedures. These kinds of protections in the private sector come in the form of a union contract. Private sector employees could get let go at any time, for any reason.

Retirement Benefits

Federal employees have a defined benefit pension. Even if changes come, the pension will still be there. Many private sector employees don’t have one. Roughly 14 percent of private sector employers offer defined benefit pensions to new hires, and less than a third of current private sector workers are covered by one.


The Thrift Savings Plan is a defined contribution plan. Government matching contributions for FERS employees are more generous than average private sector counterparts. It’s estimated that 20 percent of private sector contribution plans have no match at all.


The Federal Employees Health Benefits Program provides excellent coverage and can be carried into retirement, unlike many private sector plans.


Federal leave programs are generous. An employee with 15 or more years of federal service earns one day of annual leave per pay period. Further, sick leave is accumulated without a limit. Very few private sector employers offer that. Most have caps or a use it or lose it rule

What the Private Sector Can Offer…

The private sector can offer benefits the federal government can’t; however, they can vary widely across different workplaces and positions.


Generally, there is greater pay in the private sector, no General Schedule, and no salary caps.


There are many benefits that federal employees don’t have. Some of these may only apply to upper management or executives, however. A few examples include:

  • Onsite fitness centers
  • Discounts on company products
  • Company cars
  • Club memberships
  • Contests, prizes, and/or awards.

Retirement Pay

If you are eligible to retire, you could collect both a federal pension and a private sector salary.

Of course, this list is not exclusive. And for some people, private sector employment makes more sense, and for others, federal employment is the way to go. If the proposed retirement changes are enacted for federal employees and retirees, it’s important to know all the facts and weigh your options carefully.

Harris Federal Law Firm has helped many federal employees, who can no longer perform their job duties due to illness or injury, with their federal disability retirement cases for over a decade. If you are a federal employee who is looking at making a move to the private sector but you are struggling with your job duties because of an injury or illness, you may qualify for federal disability retirement. Don’t hesitate to call us at 877-226-2723 or fill out this INQUIRY form. We offer FREE consultations and would love the opportunity to discuss your unique situation.

Message us & find out if you qualify today!

  • This field is for validation purposes and should be left unchanged.

Recent Articles

6 Key Reasons Why Your Disability Retirement Application Was Denied

Have you recently applied for Federal Disability Retirement, only to receive a denial? The Office of Personnel Management (OPM) is denying more initial applications than ever. However, it's important to understand that a denial does not mean the end of the road for...

Federal Employee Resources

Our ever growing library of federal employee resources give you the knowledge you need to make smart choices about your future.


Frequently Asked Questions

Get the answers you need on-demand, from a team of federal employee benefits professionals.

View FAQ

Federal Benefit Webinars

Twice per month we host webinars to help federal employees better understand their benefits and answer their questions LIVE.

See Webinar Schedule

Benefit Guides

From guides to detailed charts, these educational resources will help clarify confusing federal employee benefits topics.

See our resources