NASA Workforce Overhaul Could Save More Than $1 Billion, but Contractors Raise Concerns

NASA is making a major change to the way it conducts its business, shifting more work from contractors to civil servants. The workforce overhaul is controversial, but Griffin said he welcomes the change and believes it will benefit the agency over the long term.

“I applaud Jared’s idea to get back to that in-house capability and responsibility,” he said.

NASA’s Contractor Restructuring Is Not Without Controversy

Not everyone supports Isaacman’s workforce initiative. Critics say it was rolled out too quickly and created confusion across the space agency. Still, the change appears to be a fait accompli, and few people are willing to speak publicly against it.

For this article, Als spoke with six people from a range of backgrounds, including contractors, industry leaders, and senior NASA officials who are now civil servants, to understand their concerns about Isaacman’s efforts.

The contractors most directly affected are Amentum, Jacobs Engineering Group, and KBR. The companies provide thousands of contractors to NASA, supplying engineering and other services at field centers across the country.

They argue that abandoning NASA’s decades-old workforce model creates uncertainty as the agency begins its most ambitious mission in decades: returning to the Moon and building a base there.

NASA Says Bringing Work In-House Could Cut Costs

Isaacman said NASA will benefit from cost savings and a restructuring of its technical workforce. In a staff memo, he said initial pilots of the workforce initiative had already identified more than $100 million in savings by converting employees to civil servants. Over time, he said, the savings could exceed $1 billion.

“Of course, there are cost savings associated with this initiative,” Isaacman wrote in May. “Contractor structures also have operational benefits, as they often include hierarchical management, third-party tools, contractual barriers, and other inefficiencies that hinder progress.”

Contracting companies dispute that assessment, arguing that the overhead costs they charge account for only about 2 to 3 percent of employees’ compensation.

NASA Workforce Numbers Have Already Shifted

Before the latest effort began, NASA had approximately 40,000 contractors and 14,000 civil servants. The number of civil servants has fallen by about 4,000 since the beginning of 2025, when thousands of employees left through deferred retirement and other programs implemented by DOGE to streamline the federal workforce.