Attrition: Wealth in Wartime


June 2, 2007: The U.S. Army is raising the maximum reenlistment (for three more years) bonus from $20,000, to $25,000. For two year reenlistments, troops in 45 job categories can get bonuses of up to $15,000, up from the old maximum of $6,000. The army has found that a lot of troops are willing to stay in another two years, but not another three.

For the last five years, the army has been using more cash, and more science, including regular opinion surveys, to maintain its strength without conscription. This is very unusual during wartime. Since 2003, the army has increased spending on retention bonuses from $85 million a year, to $735 million. The higher figure is still less than one percent of payroll cost. In terms of keeping trained, and experienced, people, the savings is much greater. It takes over five years to train a recruit to become a squad leader. That's over half a million dollars. So spending up to $25,000 to keep someone like that in, makes a lot of sense.

A lot more money is going to the troops, in many forms. There are now several forms of "hazardous duty" pay, as well as energetic, and expensive, efforts to make life as comfortable as possible in the combat zones. Getting air conditioning, good food, and other amenities to the battlefield costs money. But it does wonders for morale and recruiting. As a result, the cost per soldier per year has gone from $75,000 in 2001, to $120,000 in 2006. For many troops, all the cash means they come out of the service with their college mostly paid for, or with a down payment on their first home. This is a big deal, as most of their peers graduate with large college loans, and have to wait a long time to buy their first home. This angle plays well with many college graduates who enlisted, out of patriotic motives, and had no intention of making the army a career. A disproportionate number of these college enlistees volunteer for combat duty, and after two tours in Iraq, are eager to buy a home and be a civilian again.




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