What disincentivizes talented (specifically young talent) people is the ageism inherent in the system and its perverse method of rewarding people (specifically talking civil service here, contracting's another beast). Unlike the ageism you hear about in the occasional article about Silicon Valley, its the young that have a hard time in civil service. Positions aren't available because too many people are waiting to retire (for various reasons). When they do get in there are few leadership roles open for advancement (see previous sentence). Their pay is strictly time and not merit based (well, not 100%, but NSPS is gone and only a handful of places use its equivalent of merit based pay increase). Career fields are disincentivized, for instance engineers are treated better than computer scientists and mathematicians even in offices where the latter make more sense (bonuses, faster promotion schedules for trainees, pay differential for the degree). Lack of proper training programs (this is office by office, so not sure how universal the problem is, but it's pretty shabby in a lot of places). People are expected to be hired in and, within months, become experts on arcane and outdated systems, with no support because the actual expert has just retired (that's whey there was an opening). People leave quickly, similar to the Teach for America article earlier in the day, because they burn out or realize there's no where to go, neither up nor down, just steady.
On the other hand, in some regions older, talented folks can get a good deal. They can come in as a high grade GS employee with a middling step, automatically enrolled in a decent 401k (5% matching), good insurance (less critical with Obamacare?), and, after a couple years, effective tenure so they have stability which they might value for their family.