Comment by Kadin

You're conflating two very different things. Lots of people have security clearances and still work for private-sector companies (contractors). They just work on government contracts, sometimes in addition to traditional commercial work.

Other people work for the government directly, and most of these people (that I've known) also have security clearances, although there are some government jobs that probably don't require one. Why people work directly for the government I have no idea -- good pension plan, I guess? Doesn't appeal to me in the slightest.

But government contracting can be good work and good money IMO. There's more paperwork and overhead than straight commercial work, but you sometimes get to solve weird/unique problems too.

In some areas (DC) there is a big pay difference depending on what level of security clearance you have. Someone with TS/SCI can expect to make very good money, on top of whatever their experience and education would dictate, as a result of holding the clearance. This is because there are some projects which require people with those clearances, and for the highest clearances it's a relatively small pool of people (they're expensive).

However I'll agree with you on the market being inefficient. The labor market very rarely is, however. The natural tendency of people to not want to move around all the time ensures a certain amount of inefficiency, before you even involve the government.