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DoD: Poor job market help services reach goals

A lousy economy’s precise effect on retention is difficult to measure. But there’s no question about its impact on recruiting.

The numbers don’t lie. In the early 1980s, researchers found that the unemployment rate has a significant effect on the military’s ability to reach recruiting goals for high school graduates, as long as military pay keeps pace with civilian wages. Pentagon officials say that hasn’t changed.

“We do benefit when things look less positive in civil society,” said David S.C. Chu, undersecretary for personnel and readiness, during an October press conference on recruiting and retention in the fiscal year that just ended. “People are willing to listen to us. ... What difficult economic times give us, I think, is an opening to make our case to people who we might not otherwise have. And if we make our case, I think we can be successful.”

Given the current state of the U.S. economy — the unemployment rate was at 6.7 percent in November, with 533,000 jobs lost that month, and rising — and given other factors, such as a marked decrease in the overall wartime casualty rates, military recruiters should be enjoying a seller’s market.

So far, they are. All four active services have met 100 percent of their recruiting goals during the first two months of the new fiscal year. And the Army and Marine Corps, carrying the brunt of the wars in Iraq and Afghanistan, are off to very hot starts. The Army brought in 101 percent and 106 percent of its October and November goals, respectively, while Marine recruiters enlisted 104 percent and 105 percent.

The six reserve components are doing just as well — all were at or above 100 percent of their goal for October and November, the Pentagon said.

Of equal or greater concern than the raw numbers, however, is the quality of recruits. And the jury’s still out in fiscal 2009’s early stages on whether the services, particularly the Army, are signing up enough of the smartest recruits and minimizing the number of enlistees for whom official waivers are required — both factors that have attracted congressional concern.

Numerous studies show that high education levels, Armed Forces Qualification Test scores and experience all correlate to good productivity and flexibility in service, according to Steve Kosiak of the Center for Strategic and Budgetary Assessments. Recruits with high school diplomas are far more likely to complete their first terms and perform better down the road.

High school graduates with AFQT scores above the 50th percentile are considered to be “high-quality” enlistees.

In fiscal 2008, the Army recruited 101 percent of its overall goal. But the service missed the Pentagon’s 90 percent benchmark for high school diploma-holders, bringing in 83 percent. The other three services exceeded that figure, with the Navy leading all services at 94 percent.

On the plus side, the Army improved on its 79 percent diploma rate from the previous year.

But the Army also skirted the line in two other quality categories. Just 62 percent of its recruits scored at or above the 50th percentile on the Armed Forces Qualification Test, 2 percentage points above the Pentagon’s 60 percent goal.

The Marines fared a little better with 66 percent. The Navy and Air Force figures were 74 and 79 percent, respectively.

The Army did reduce the number of enlistees who required waivers during the past fiscal year. In fiscal 2007, it granted waivers to 571 enlistees with felony convictions. That fell over the succeeding 12 months to 372, according to Maj. Gen. Thomas Bostick, commander of Army Recruiting Command.

“We do give people a second chance,” Chu said.

The poor economy could help drive down all those negative numbers. Economists say there’s a direct correlation between the economy and recruit quality.

John Warner and Curtis Simon of Clemson University estimate that a 10 percent increase in the unemployment rate leads to a 3 percent to 4 percent increase in high-quality enlistment. Another study suggests a 5 percent increase, Warner said.

For example, if recruiters sign up about 120,000 “high-quality” individuals, or about 60 percent of their 200,000 total contracts, when the unemployment rate is 5 percent, they can expect 6 percent to 8 percent more high-quality enlistments when the unemployment rate climbs to 6 percent, Warner said — an additional 7,200 to 9,600 high-quality recruits.

The Pentagon expects to spend at least as much on recruiting and retention bonuses this fiscal year as the last — although retention bonus spending is falling as past bonus outlays, fewer casualties in Iraq, the promise of more time back home between deployments and the weak civilian employment outlook combine to keep retention strong.

Still, the Pentagon will shell out about $750 million for recruiting bonuses in fiscal 2009, including student loan forgiveness, Chu said. Experts warn that trimming the recruiting budget in good times can have a negative long-range effect on stability.

Also in the Pentagon’s quiver: the new Post-9/11 GI Bill. Officials and experts say it’s too early to tell what sort of impact the generous benefit and its transferability feature will have on potential recruits. But overall, education benefits are a prime recruiting tool, particularly for high-quality enlistees, experts say.