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Summary

In the late 1990s, the military services were facing considerable recruiting and career retention problems. In responding, Congress was mindful of how inadequate pay had contributed to decreased recruit quality in the late 1970s. It authorized larger pay raises, increased special pays and bonuses, provided more recruiting resources, and repealed planned military retired pay reductions for future retirees. In the spirit of national unity following the attacks of September 11, 2001, recruitment improved. The programmatic changes noted above also helped recruiting substantially. However, the grueling pace of deployments to and from Iraq and Afghanistan, combined with the dangers of combat, began to cause long-anticipated recruiting problems for the All-Volunteer Force. In 2005, the Army, Army National Guard, and Army Reserve all fell short of their recruiting goals. An infusion of additional recruiters and a congressional increase in the maximum enlistment bonus from $20,000 to $40,000, contributed to the active Army meeting its 2006, 2007 and 2008 recruiting targets. Career retention of servicemembers beyond their initial period of obligated service is difficult to measure, due to the suspended separation and retirement of many personnel since September 11, 2001, but so far retention is reported to be more than satisfactory. However, the services anticipate a challenging recruiting year in FY2009. Debate continues over what kinds of pay and benefit increases are best for improving recruiting and retention. Of particular interest is the balance between across-the-board pay raises on the one hand, and ones targeted by grade, years of service, and occupational skill, on the other; and between cash compensation on the one hand and improvements in benefits such as housing, health care, and installation services on the other. The issue of pay comparability between military and civilian pay, commonly referred to as the "pay gap," continues to receive emphasis. While many analysts believe the gap has been reduced to less than three percent by the FY2009 pay raise, others argue that pay and benefit increases since 9/11 have eliminated the gap. The issue persists, in part, because the numerous different elements of military pay make it difficult to compare to civilian salaries and other benefits. Since the early 1990s, numerous changes in benefits have greatly favored individual members. These include changes in the cash allowance received by personnel not living in military housing, a major overhaul of military health care, and repeal of military retired pay cuts first enacted in 1986. This report will be updated as needed.

Related Legislation:
• S.2006

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