No abstract

For military children and their families, the economic news is mostly good. After a period of steady pay increases, James Hosek and Shelley MacDermid Wadsworth write, service members typically earn more than civilians with a comparable level of education. Moreover, they receive many other benefits that civilians often do not, including housing allowances, subsidized child care, tuition assistance, and top-of-the-line comprehensive health care. Of course, service members tend to work longer hours than civilians do, and they are exposed to hazards that civilians rarely, if ever, face. The extra pay they receive when they are deployed to combat zones helps their families cope financially but cannot alleviate the stress. Though service members are relatively well paid, the military lifestyle takes a toll on the earnings of their spouses. Chiefly because the military requires service members to move frequently, spouses' careers are regularly interrupted, and employers are hesitant to offer them jobs that require a large investment in training or a long learning curve. More military spouses than comparable civilian spouses are either unemployed or work fewer hours than they would like, and military spouses overall tend to earn less than their civilian counterparts. Despite the military's relatively high pay, some service members and their families--particularly among the junior enlisted ranks--report financial distress, and a handful even qualify for food stamps. Moreover, precisely because military pay tends to be higher than civilian pay, families may see a drop in income when a service member leaves the armed forces. Finally, the pay increases of recent years have slowed, and force cutbacks are coming; both of these factors will alter the financial picture for service members, possibly for the worse.

No abstract

Prepared for the Office of the Secretary of DefenseApproved for public release; distribution unlimitedThe RAND Corporation is a nonprofit research organization providing objective analysis and effective solutions that address the challenges facing the public and private sectors around the world. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.R ® is a registered trademark. © Copyright 2010 RAND CorporationPermission is given to duplicate this document for personal use only, as long as it is unaltered and complete. Copies may not be duplicated for commercial purposes. Unauthorized posting of RAND documents to a non-RAND website is prohibited. RAND documents are protected under copyright law. For information on reprint and linking permissions, please visit the RAND permissions page (http://www.rand.org/publications/ permissions.html). The research described in this report was prepared for the Office of the Secretary of Defense (OSD). The research was conducted in the RAND National Defense Research Institute, a federally funded research and development center sponsored by the OSD, the Joint Staff, the Unified Combatant Commands, the Department of the Navy, the Marine Corps, the defense agencies, and the defense Intelligence Community under Contract W74V8H-06-C-0002.iii This monograph provides an empirical analysis of the enlistment, attrition, and reenlistment effects of bonuses, applying statistical models that control for such other factors as recruiting resources, in the case of enlistment and deployments in the case of reenlistment, and demographics. Enlistment and attrition models are estimated for the Army and our reenlistment model approach is twofold. The Army has greatly increased its use of reenlistment bonuses since FY 2004, and we begin by providing an in-depth history of the many changes in its reenlistment bonus program during this decade. We follow this with two independent analyses of the effect of bonuses on Army reenlistment. As we show, the results from the models are consistent, lending credence to the robustness of the estimates. One approach is extended to the Navy, the Marine Corps, and the Air Force, to obtain estimates of the effect of bonuses on reenlistment for all services. We also estimate an enlistment model for the Navy. The estimated models are used to address questions about the cost-effectiveness of bonuses and their effects in offsetting other factors that might adversely affect recruiting and retention, such as changes in the civilian economy and frequent deployments. The report should be of interest to policymakers concerned with military recruiting and retention and to defense manpower researchers.

No abstract