Federal HR systems cost taxpayers billions, Workday survey reveals

Federal HR systems are squandering billions in taxpayer dollars through inefficient, outdated technology according to a new report from MeriTalk and Workday. The study reveals that 89% of federal HR leaders believe legacy tools hinder their agency’s mission, with HR teams wasting nearly half their time correcting errors, reconciling data, and navigating manual processes. This technological stagnation is occurring precisely when government needs greater agility, with potential savings of up to $1 billion annually if just half of this wasted time could be recovered.

The big picture: Federal HR operations are struggling with outdated systems that actively undermine workforce strategy and government service delivery.

• Nearly all respondents (96%) believe modern human capital management platforms are essential for effective public service.
• Despite this recognition, just 48% of agencies prioritize HR modernization, and an alarming 83% have no modernization roadmap in place.
• The survey findings coincide with a Trump administration Executive Order aimed at reforming federal hiring and restoring “merit” to government service.

Behind the numbers: Technical limitations create cascading inefficiencies that drain resources and hamper workforce management.

• More than a quarter of HR teams routinely encounter system downtime that interrupts operations.
• 42% of agencies receive delayed or inaccurate reports that compromise decision-making capabilities.
• Nearly half (47%) have data updates held up by manual processes, creating information bottlenecks.

Untapped potential: Federal HR leaders estimate that 61% of their team’s processes could be at least partially automated.

• Top automation opportunities include resume screening, interview scheduling, skills assessments, and career planning.
• Employee engagement, security/fraud detection, and compliance reporting also present significant automation potential.
• Implementation barriers include inadequate vendor tools, limited interagency collaboration, and complex regulatory requirements.

The path forward: The report outlines several strategic priorities for federal agencies to modernize their HR operations.

• Agencies should elevate HR modernization to a strategic priority and treat HR systems as mission-critical IT investments.
• HR modernization should be integrated into broader digital transformation initiatives rather than addressed in isolation.
• Implementing advanced analytics, shared data environments, and robust security measures are essential components of effective modernization.

Why this matters: The report emphasizes that HR systems have evolved beyond administrative functions to become essential strategic tools for workforce development and organizational performance.