The Department of Defense is committed to maintaining readiness and ensuring that America continues to field the best trained, best equipped fighting force in the world. In order to accomplish these goals, the Department relies on the courage, training, professionalism, and morale of each individual man and woman in uniform. No weapon system is better than the people who operate and maintain it. As a result, one of the Department's most important tasks has been to maintain the high quality of its servicemembers.
FORCE STRUCTURE AND MANPOWER LEVELS
Readiness is the Department's top priority. In fact, DoD is restructuring U.S. armed forces in order to maintain readiness. Cutting force structure is central to the Department's plan to maintain both readiness and balance in defense posture. In planning for the future, the Department faced various tradeoffs between appropriate force size and adequate resource levels to ensure forces will remain ready.
By the late 1980s, signals were clear that DoD was going to downsize. By conducting the Bottom-Up Review and taking a tough, comprehensive look at force structure, the Department determined that by 1999 the active duty force requirement would be 1.4 million -- a significant drop from nearly 2.2 million on active duty in the late 1980s. Today, with an active force of between 1.6 and 1.7 million, the drawdown is about 75 percent complete.
Despite the difficulty of this transition, two important objectives have been achieved. First, readiness has been maintained; and second, people are treated fairly. Indeed, one of the keys to maintaining readiness is putting people first. Massive reductions-in-forces (RIFs) have been avoided, and transition programs for departing members continue to be offered.
The Department plans to continue the force and personnel drawdown as initiated in previous years. The Army will reduce from 24 divisions during FY 1992 to 20 divisions by FY 1995 (12 active and 8 Reserve component). The Navy's Battle Force ships will decrease in number from 467 in FY 1992 to 373 in FY 1995. Included in the totals is a reduction of one aircraft carrier, bringing the total to 11 active and one Reserve aircraft carriers. The Marine Corps will maintain its three active and one Reserve divisions. By the end of FY 1995, the Air Force will have reduced to about 21 fighter wing equivalents (13 active and 8 Reserve component) from 29 fighter wing equivalents in FY 1992. Other U.S. attack/fighter air forces will include 10 active and one Reserve Navy carrier wings and three active and one Reserve Marine Corps wings. Strategic bombers will be decreased from 209 in FY 1992 to 141 by the end of FY 1995. The Air Force will also reduce the number of intercontinental ballistic missiles from 930 in FY 1992 to 585 by the end of FY 1995.
The President's budget request for active military, Selected Reserve, and civilian manpower for FY 1995 also continues to make significant progress toward the stated goals for the size of the military. At the onset of FY 1994, active duty military strength was at 1,705,103; by the end of FY 1995, active strength will decrease to 1,523,251. Selected Reserve will be reduced to 964,997 and civilian employees to 866,927. Many of the civilian reductions were initiated due to the Department's involvement in reductions and streamlining as directed in the National Performance Review in which DoD has taken a majority of the mandated Full-Time Equivalents (FTE) reductions. The civilian end strength represents a reduction of 4 percent from FY 1994 levels and is a direct result of accelerated civilian reductions during this past year. The accelerated reductions moved FY 1999 goals forward to FY 1997. These figures could be altered by a report requested by the armed services committees in the FY 1995 Authorization Conference Report. This report should identify a number of active duty positions in the Services, defense agencies, and field activities for conversion to civilian positions, freeing military members for combat positions.
DoD recruits high quality people, provides them the rigorous and realistic training that enable the Services to maintain readiness, and finally, rewards their service by treating them fairly. These three objectives are not subject to change. Even in this time of profound change in America's national security concerns, the Secretary of Defense recognizes that these commitments are the foundation of a successful, ready-to-fight force.
RECRUIT HIGH QUALITY PEOPLE
One part of maintaining readiness is ensuring a steady flow of new recruits. Each Service must recruit enough enlistees per year to sustain a flow of seasoned leaders for the future. Each year DoD must recruit about 200,000 young people to join the full-time, active duty armed forces and approximately 150,000 for the Selected Reserve. The Department estimates that over the next three years non-prior Service accession missions for the active force will increase 19 percent from the current levels.
In recent years, DoD has done well in attracting high quality recruits. For example, over the last two years, more than 95 percent of all active duty recruits held a high school diploma, while only about 75 percent of American youth, ages 18 to 23, have that credential. In addition, about 70 percent of new recruits have top-half aptitude scores, compared to 50 percent of the total youth population. Higher levels of recruiting quality serve to reduce attrition while increasing hands-on job performance -- and that means dedication and productivity, which are essential to unit performance and readiness.
Challenges in a Changing Recruiting Environment
All Services are facing a growing challenge -- American youth are becoming less interested in joining the military. Recent surveys show that 25 percent of 16 to 21 year-old men expressed propensity to join at least one active duty Service. This is a 2 percent decline from the 1992 level, and a 7 percent decline from the historic high of 32 percent in 1989 and 1990.
The Department believes that its greatest recruiting challenge is the lower propensity of American youth to enlist. Publicity about downsizing, coupled with reduced advertising budgets, seems to be giving the public the impression that the Services no longer are hiring, or that they are not a secure employer. The Services are still hiring as mentioned before; they need 200,000 new recruits each year.
Congress recently increased the Department's advertising budget to help ensure that American youth are acquainted with armed forces opportunities. American youth need to receive the message that the Services still want them. In spite of the downsizing, the U.S. military is still one of the nation's largest employers and also one of the best.
National Service and Recruiting
The Department's review of the impact of National Service on military recruiting pointed to two critical determinants of whether the programs can coexist successfully -- the size of the National Service program (which determines its impact on armed forces recruiting efforts), and the value of its benefits in comparison with enlistment benefits. On both counts, DoD believes that the programs are correctly sized and shaped, ensuring that success in one does not jeopardize the other.
The Department is confident that the current size of National Service programs will not jeopardize recruiting programs -- and recent year experience bears this out. Moreover, given the greater value of the military education benefit (Montgomery G.I. Bill) and the great depth of training provided by the active military, there is no recent indication that National Service programs would inordinately drain the pool of potential military recruits; again, this is borne out by recent year experience -- FY 1994 was the third best in the history of the all-volunteer force.
Recruiting -- An Essential Priority in DoD
The Department will continue to focus on quality recruiting. The Deputy Secretary of Defense formed a standing panel which includes the Secretaries of the military departments and the Chairman of the Joint Chiefs of Staff that meets quarterly and reviews the status of recruiting. This panel deals quickly and effectively with any emerging problems.
In addition to creating this panel, DoD has focused on three major recruiting initiatives.
Also critical to the success in recruiting efforts are the recruiters themselves. To better understand the recruiters' environment, a DoD Recruiter Survey is being used. Results are expected to be released early in 1995. This report will give a better idea of how recruiters are coping with the most difficult recruiting period since the very inception of the all-volunteer force. Additionally, to better support the recruiters, DoD is planning to field the Joint Recruiting Information Support System (JRISS).
Recruiting for the Selected Reserve
The position of the Army Reserve and Army National Guard is that downsizing, reduced budgets, and inactivating local units all serve to give the public the impression the reserves are no longer hiring, or the reserves are not a viable employment opportunity. Increased advertising budgets and more recruiters are needed to achieve outyear missions especially after downsizing abates and accession missions increase.
Full-Time Support to the Reserve Components
There are four categories of full-time support personnel who assist in organizing, administering, recruiting, retaining, instructing, and training the Guard and Reserve: Active Guard/Reserve; military technicians; Active component members assigned to support Guard and Reserve units; and federal civil service members. Table V-3 shows current and planned full-time support strengths.
Full-time support personnel provide the essential foundation for Guard and Reserve unit readiness. With more missions being placed on Guard and Reserve units and the inherent litigations on the training time of part-time members, adequate full-time support is imperative to ensure effective use of available time and proper maintenance of sophisticated equipment.
REALISTIC TRAINING TO KEEP THEM READY
The Department will continue to invest in quality training and maintaining operating tempo (OPTEMPO) standards for air, ground, and sea operations. Additionally, DoD will continue to invest in institutional or schoolhouse training, which includes specialized skill training, acquisition of recruits, officer training, and professional development courses. DoD offers over 20,000 courses -- an investment of $15 billion -- which produce 1.15 million graduates annually.
In addition to the individual proficiencies derived from schoolhouse training, the Services also invest heavily in unit training and readiness. The linkage between readiness and large unit training is well founded. DoD has directed the Services to fund readiness as its top priority. One only needs to visit the National Training Center to see how crucial large unit training is, or stand on the pitching deck of an aircraft carrier to marvel at the finely honed skills required to launch and land carrier aircraft.
The Department is working to understand readiness fully and maintain standards consistent with the Bottom-Up Review. It has mapped out the roles and responsibilities of the Services, the Commanders in Chief, the Joint Staff, and the Secretary of Defense. Several senior level panels have addressed readiness issues: the Senior Readiness Oversight Council, the Readiness Working Group, and the Readiness Task Force. And, at the same time, the Department is working to keep the armed forces ready. Specifically, it is developing input/output models that will help in allocating funds to maintain readiness.
Currently readiness is adequate and will remain there in the future, assuming that budgets are approved and that the Bottom-Up Review enhancements are forthcoming. Those enhancements include Army prepositioned stocks; strategic airlift and sealift; improved command, control, communication, and intelligence; and improved Army Guard and Reserve readiness and flexibility. Still, DoD will continue to watch for signs of hollowness such as growing or unacceptably high equipment maintenance backlogs, diversion of operation and maintenance funds from training to unfunded contingency missions, declining personnel quality, and declining personnel fill.
TREATING PEOPLE FAIRLY
The national security of the United States relies on well trained, equipped, and ready combat forces. In order to execute their responsibilities, the men and women of the Services must function as a unified team, united by a special bond of trust, mutual respect, loyalty, and shared sacrifice. These interrelationships distinguish the military from other large organizations and form the context within which the Department's equal opportunity policies and programs are understood.
Discrimination and sexual harassment jeopardize organizational readiness by weakening interpersonal bonds, eroding unit cohesion, and threatening good order and discipline. DoD supports readiness by comprehensively addressing human relations issues and by expeditiously investigating and resolving discrimination complaints. DoD strives to ensure it is an organization where every individual is free to contribute to his or her fullest potential in an atmosphere of respect and dignity.
The Department has carefully monitored the effects of the downsizing on minorities and is pleased to report that minority representation did not experience change as a consequence of the defense build-down. Section 533 of Public Law 103-337 requires the Department to report on readiness factors by race and gender. This report is at Appendix G. The appendix also discusses the Department's review of the Services' discrimination complaint procedures and suggested improvements to ensure the fair and prompt resolution of identified transgressions.
Good quality of life, including adequate compensation, is an important component of medium-term readiness. Toward that end, the President announced a $25 billion increase in defense spending over the next six years. These funds will substantially improve DoD's quality of life posture. Initially the funds will be targeted on three broad areas: compensation adjustments, housing and barracks improvements, and better community services.
Pay/Compensation Issues
Senior leadership has pointed to three vital components of support for personnel: adequate and fair compensation, a steady and dependable level of medical benefits, and a stable retirement system. In order to attract, motivate, and retain quality people, the Department must provide a standard of living for its members that can compete with the private sector into the 21st century. If it does not, the Services cannot continue to recruit and retain high quality people in the all-volunteer force.
Over the past decade, military pay raises have not kept pace with the private sector, as measured by the Employment Cost Index -- this continues as a matter of concern. To help safeguard the effectiveness of recruiting and retention programs, the Department announced a package of benefits designed to improve quality of life and to sustain recruiting and retention. Three important components of that package relate to compensation. First, the Department will implement a cost of living allowance in areas of the continental United States where local costs exceed 109 percent of national average living costs. Second, the Department is moving to reduce the excessive absorption of housing costs now being experienced by those in uniform. Third, DoD intends to budget for the full pay raises allowed by law for the armed forces, consistent with the readiness initiatives announced by the President on December 1, 1994.
The Department has dealt aggressively with an unpopular rule in the pay system -- the practice of stopping the subsistence allowance (BAS) for those on field duty. As a result, the Department is applying three sequential fixes:
Together, these changes will improve the compensation program for members of the armed forces and their families, and these investments constitute a sound means of preserving near- and medium-term readiness.
Promotions
Promotions and compensation go hand in hand. There are indications that servicemembers are concerned about promotion rates falling during this restructuring period. It is a common misconception that promotions have been frozen because of the drawdown, but that is simply not the case. Last year, the Services promoted over 125,000 soldiers, sailors, airmen, and marines into the top five enlisted grades (E5-E9) -- a promotion, on average, for each enlisted member of once every five years.
Generally, promotions have remained steady during the drawdown. There has been only a slight increase in the average promotion time for some grades and skills. Promotion opportunity has also held steady, generally remaining within 5 percent of the levels the Department saw before the drawdown began. For the future, the Department expects promotion points will improve and promotion opportunity will remain steady.
Retention
During the past seven years, active military strength has dropped by more than 500,000. While some additional strength reductions are planned, the Department remains committed to achieving them on a voluntary basis to the greatest possible extent. To date, more than 95 percent of the drawdown has been accomplished through normal attrition, reduced accessions, and voluntary separation incentive programs -- the Voluntary Separation Incentive (VSI), the Special Separation Benefit (SSB), and the Temporary Early Retirement Authority (TERA). The success of these voluntary programs has enabled DoD to maintain reasonable promotion flows, to largely avoid involuntary separations, and to demonstrate a continuing commitment to treat people fairly -- both those who stay and those who leave. A more detailed discussion of retention is found in the appendices to this report.
Separation and Transition
DoD is making sure that those leaving are treated fairly for the sacrifices made while serving their country. The Department remains steadfast in its commitment to offer those leaving military service a wide range of transition services and benefits. A private research firm found that the DoD transition program is much more comprehensive in terms of the types of services provided than many private sector programs.
Since the beginning of the all-volunteer force, DoD policy has recognized that a positive quality of life in the nation's armed forces is a vital element of defense capability. Its commitment to treat people right has helped attract the best people to serve in the nation's defense. Transition support and services are a vital part of treating members right, even as they prepare to leave military service and embark upon new careers. This common sense approach to military separation is essential for the well-being of all military members. For more information on transition support to servicemembers, see the chapter on Quality of Life.
THE CIVILIAN WORKFORCE
Regionalization of Civilian Personnel Services
In 1993, the Department initiated a monumental restructuring plan for regionalization and systems modernization of civilian personnel services. DoD, with Service input, has conducted an extensive analysis of civilian personnel functions and developed a servicing model that identified those functions that could be most efficiently consolidated in regional service centers. The evaluation confirmed that with proper investment, regionalization and automated systems modernization (Defense Civilian Personnel Data System (DCPDS)) are both achievable and cost effective. DoD's regionalization and systems modernization efforts will result in reduced operation and maintenance costs, standardization of civilian personnel management applications throughout DoD, interoperability with other DoD functional areas, and easy access to real-time management information for managers. Regionalization and systems modernization will also significantly improve the Department's personnel servicing ratio (with a 33 percent savings in personnel specialists) by taking maximum advantage of business process improvements. There is the potential for five new regionalized centers each year from FY 1995 through FY 1998.
Modernization of the Automated System
The Department is radically redesigning personnel processes to achieve major improvements in performance. Through data standardization, DCPDS now supports 85 percent of all DoD civilians. A transition plan has been developed to encompass the remaining DoD employees in the near future.
DCPDS applications have resulted from extensive reengineering of personnel processes. Some of those computer applications will give current and projected civilian personnel costs; maintain, rank, and report job applicants for DoD jobs; significantly reduce response time to inquiries; integrate automated job classification, staffing, performance management, and training requirements in a single document; enable users to electronically request training, evaluate results, produce reports, and track requirements and expenditures; and enable personnel staff to access information on employee compensation claims and associated costs immediately. For DCPDS's reengineering work, Government Executive Magazine presented DoD with a 1994 Outstanding Achievement Award for Making Government More Effective through the Use of Information Services.
The Department also joined the Office of Personnel Management to found the Federal Human Resources Management Automation Consortium to develop and market software applications to other agencies. Showcased at the DoD Human Resources Reinvention Laboratory in Crystal City, Virginia, these applications have been seen by visitors from other government agencies and private industry from all over the world. The Department will continue to develop and implement the Strategic Information Systems Plan for DCPDS and for automated systems to support regionalized off-site human resource service delivery.
Civilian Downsizing and Transition Assistance
Since September 1989, DoD has reduced its civilian end strength by about 220,000 or almost 20 percent. To minimize involuntary layoffs, the Department has aggressively implemented a separation-pay or buyout program. Under this program authorized by Congress in 1992, DoD offers cash incentives -- up to $25,000 -- to employees who resign or retire. The buyout is available to employees when it will prevent an involuntary separation or create a vacancy for an employee who would otherwise be separated. To date, the Department has paid close to 50,000 incentives, avoiding significant RIFs throughout the Department and protecting the diversity of its workforce. The Department's program is the model for the Federal Workforce Restructuring Act which allows non-defense agencies to offer buyouts to facilitate reductions without involuntary separations.
DoD continues to use other highly effective programs to help civilians find new jobs. The most notable is the Priority Placement Program (PPP), an automated system that matches employees who are scheduled to be separated with vacant DoD positions for which they are qualified. Since its inception in 1965, PPP has placed over 120,000 employees. The Defense Outplacement Referral System (DORS) is another automated system that refers applicants to federal and non-federal employers. DORS and PPP give employees alternatives to separation. These options will be increasingly important as the Department closes additional installations and seeks to minimize the adverse impact on individuals. Additional information on DORS can be found in the Quality of Life chapter.
In addition to extending the drawdown and transition authorities until September 1999, the National Defense Authorization Act for FY 1995 included a provision that allows the Department to establish a pilot program at closing and realigning bases. To further encourage private-sector employers to hire DoD's surplus people, the Department's new pilot program will not only reimburse employers for retraining costs but will also pay relocation expenses for employees who move to take a job with a non-federal employer. These incentives, limited to $10,000 per employee, will make surplus employees more valuable to other employers while avoiding the cost of unemployment insurance compensation. The Department remains committed to minimizing the number of involuntary separations, assisting those employees who may have to separate, and protecting workforce diversity.
Civilian Training and Education
The Department spends approximately $500 million annually on civilian training tuition, materials, and related travel. Prior to this year, the expenditure was not based on the kind of systematic, universal, readiness-based program as that used to justify military training, education, and opportunities.
This year, DoD launched a major effort to provide a more universal, comprehensive, and systematic program of civilian career and leader development to enhance support of the changing national security objectives of the Department. During this year, an Office of the Secretary of Defense and component civilian personnel leadership group began developing the program by inventorying all civilian training and leadership development programs to provide a first-time menu of opportunities for all civilians, reviewing all internally and externally mandated civilian training programs, and beginning a study of a return-on-investment model for training and career development. These redesign efforts will be tied to the Department's automation initiative for civilian training -- TRAIN -- which has been developed by a multi-component working group and is now being tested. This comprehensive redesign effort in civilian career and leader development responds to the President's call for greater and smarter investment in human capital.
DoD will continue to treat all of its active duty, reserve, and retired servicemembers fairly. Service in the armed forces will continue to be a great career choice. When the downsizing is complete the Department will still have 1,400,000 people on active duty and over 900,000 in the Selected Reserves. The Services will continue to recruit over 200,000 people each year for active duty forces -- as well as over 150,000 for the Selected Reserves -- to maintain the proper mix of junior, mid-career, and senior servicemembers.
Finally, DoD's overarching goals are to maintain a high state of readiness and to treat people fairly. That means servicemembers of all grades will continue to receive exceptional training and educational opportunities, challenging worldwide assignments, and the best equipment. Advancement opportunities are excellent, particularly when compared to private sector career options. The bottom line is that with good duty performance, career-oriented servicemembers can expect to see steady advancement, professional training and education, and challenging leadership opportunities.
