Price Elasticity and Army Officer Retention

Today's New York Times has an article about the Army's inability to retain company grade officers for second tours of duty. Scepticism is the watch word on anything reported by the NYT about the military. Their record of bias and selective reporting is just too egregious.

Additionally, the article itself does a great deal to refute its own point. Next to the column in the on-line edition, they include a chart that shows a decided recovery from lows in retention over the past couple of years. Further, buried in the article are comments like:

In 2001, but before the Sept. 11 terrorist attacks, 9.3 percent of the Army's young officers left active duty at their first opportunity. By 2002, the number of those junior officers leaving at their first opportunity dropped to 7.1 percent, and in 2003, only 6.3 percent opted out. But the number grew to 8.3 percent in 2004 and 8.6 percent in 2005.

Smoothed with a running average the annual differentials are what? Not much, apparently. So the point is?

Well, the point should be that junior office retention is very responsive to incentives. Having invested a good deal in time and training, most young officers will respond very well to offers of further education and higher salaries. Most young officers like the military and want to stay. Having been a young Marine officer years ago, I can say with confidence that most officers will choose to stay if given a good excuse.

That is low price elasticity of demand. And that is a good thing for the Army, the officers and our safety. But you wouldn't know it from reading the New York Times.

0 comments: