Air University Review, January-February 1981

Stop the Hemorrhage of Talent

In the bitter aftermath of the unsuccessful Iranian rescue mission, one positive result has been the great interest expressed by the media and the public in the ability of our armed forces to face up to the difficult power struggle ahead and in the critical issue of whether we have enough high-quality personnel to carry out essential missions across the globe.

Ironically, only a few weeks before the abortive rescue mission, the serious news that for the first time in fifteen years the Navy had to remove a ship, the U.S.S. Canisteo (AO99), from operations because of a shortage of key crew members rated no better than a short column on a back page of the New York Times.¹ The Canisteo an oiler, had lost many veteran noncommissioned officers (NCOs) who had left the Navy, and there were not enough boiler technicians and machinist mates to run the ship. It is equally interesting, that after some weeks, several NCOs were assigned on temporary duty to the Canisteo, with the task of training young seamen to operate the boilers and other technical equipment. This incident serves to underscore the severe retention problem that the armed services are facing.

Only recently Admiral Thomas B. Hayward, Chief of Naval Operations, testified before Congress that a "hemorrhage of talent" had already reduced the combat readiness of many ships and air squadrons. Admiral Hayward admitted that the Navy is approaching the point where it has no realistic alternative but to consider standing down some ships and aviation units. He stressed, as have many other responsible leaders, that this serious brain drain stems in large part from the failure to pay seasoned NCOs for their hard-to-acquire skills and for the unique deprivations, especially in terms of family life, that go with military service.

In a devastating report, former Secretary of Defense Melvin R. Laird stated categorically that the President, Congress, and the public have failed to honor a commitment made at the time of the ending of the draft in 1973 to provide a decent standard of living and a meaningful quality of life for the men and women who have volunteered for duty in the armed forces and for their families. Laird further stated that the nation has reneged on its commitment and is failing to provide a decent and competitive standard of living for armed forces personnel.² Indeed, in the strongest indictment that has yet appeared in print, he calls the failure to retain a requisite number of those completing their second and third terms "devastating.’’

Until now, the response of the President, in the form of a memo to Defense Secretary Harold Brown and top Pentagon leaders, told them to stop being so critical about military pay, retention, and combat readiness. The President said that the constant drum of criticism from top military officials about pay and readiness hurts morale.³

To my knowledge, no gag order has ever succeeded, either in solving a problem or in quieting people who are concerned with the underlying problem. All too many military leaders in the past have paid scant attention to industrial relations and employee relations problems. Only now, when double-digit inflation at a rate of over 18 percent per annum is squeezing armed forces personnel, especially NCOs, to the wall, do we suddenly realize that the armed forces are no longer competitive in compensation with their competitors for skilled and experienced people. Those individuals who form the backbone of the NCO cadre and provide a reservoir of technological skills and long years of practical experience necessary to operate and maintain our sophisticated weapon systems are now leaving the armed services in record numbers. Remember, I am not talking about first-termers, whose attrition rate since 1976 has been almost 75 percent, but rather about NCOs at the eight, nine, and ten-year marks, whom it will take a decade to replace.⁴ At this rate, where will we be in 1990?

From a political standpoint, the President must face some difficult choices. He has been in the midst of a presidential campaign, where it was fashionable to orate about cutting spending, balancing the budget, and showing fiscal restraint.⁵ But with the had news from Tabas, Iran, the President is going to have to answer the media when it questions him about whether the armed services are retaining enough high-caliber personnel to carry out missions around the globe: on carriers like the Nimitz, which was involved in the rescue mission, as well as in amphibious and air units. He may be hardput to explain a retention rate in the Air Force among second- and third-term personnel that fell from 75 percent to 59 percent or in the Navy that fel1 from 64 percent to 45 percent. These statistics speak for themselves.

threat of military unionism

Many workers in the private sector who have been hit hard by this inflation, especially in those areas of the nation traditionally nonunion and right-to-work, have been turning in increasing numbers to union organization. The National Labor Relations Board reports a marked increase in union organization in the Sun Belt. Industrial relations experts feel that there is a direct correlation between media reports of union contracts keeping union members even with inflation and the new-found popularity of unions in traditionally nonunion areas.

Nevertheless, there are no signs that military unionism is being looked to by members of the armed forces as a solution to their problem. In addition to the ban on military unions and on armed forces members joining military unions, as well as banning military commanders from engaging in collective bargaining with military unions, there is simply no union willing to approach the monumental financial and manpower burden in organizing the military.⁶ Very substantial technical labor problems are involved even in defining an appropriate unit in the armed forces, in determining what showing of interest would have to be produced on signed authorization cards by the petitioning union, or in determining who would be included in the appropriate bargaining unit and be declared eligible to vote.

While I do not see military unionization as a practical approach or alternative, I would only caution that the direct forerunner of the postal strike of March 1970, which led to the creation of an independent Postal Service, was former President Nixon’s action in denying a 4 percent pay raise to the then underpaid postal workers in the name of "fiscal restraint."⁷ The collective bargaining procedures that have ensued since 1970 have made the postal workers the highest paid federal employees.⁸ Labor history has shown time and again that employees who feel exploited and bereft of dignity will do strange things. I do not see a move to military unionization in the short run, but allowing dissatisfaction and unfair conditions to fester can ultimately produce the unexpected.

The public has now been saturated with media coverage on the terrible inequity in present military compensation and the family suffering that it has produced. One need only read the series "Serving the Flag at the Poverty Level," which appeared in a daily newspaper with the highest circulation in the nation, to realize that the general public now understands the problem and wants a fast solution.⁹ The changes in the administration and in the chairmanship of the Senate Military Affairs Committee have already produced very strong indications that the present catch-as-catch-can compensation system can no longer be allowed to sap the military of those trained noncommissioned and junior officers whom the nation needs most. They will not accept a penny-pinching, second-class existence in an inflationary era. Change must come now.

The public and the media realize that military pay has not kept pace with inflation, and this imbalance is driving many high quality people out of the service. As a nation we are very much troubled about our security. We want a strong military and do not want to risk allowing our armed forces to deteriorate.

There is a way to stop this deterioration and turn the desperate situation around in short order. In fact, the machinery already exists, not only in the private sector but in one of the largest federal agencies. It could be adapted to the armed forces in a month, given the support of the Congress and the President.

I speak of those magic words now contained in hundreds of private sector contracts and in one federal contract, namely, the cost of living adjustment (COLA). It is to the credit of an enlightened Postal Service management agreement and a group of Postal Union leaders with great foresight that ten years ago they foresaw just how important this economic machinery would be to the workforce. Each postal employee covered by the collective bargaining agreements with management, basically clerks, carriers, mailhandlers, and rural carriers, get COLA adjustments when the new Consumer Price Index (CPI) is issued quarterly. The base salary schedules provided for in the postal agreements are increased one cent per hour for each 0.4 of a point increase in the applicable index above the base index of June 1978. For employees not paid by the hour, there is a formula for converting the cost of living adjustment. For example, if the increase in the CPI from June 1979 to September 1979 was 1.6 points, all pay scales covered by the COLA would be increased by four cents per hour or by a corresponding increase for those employees not paid by the hour.¹⁰

In 1978, postal workers received $1518 as a cost of living adjustment, and by agreement of the parties, this COLA was incorporated into their basic annual salary. In 1979, there was a $1477 cost of living adjustment above a regular increase of 3 percent of the basic annual salary. If inflation continues at its present rate, this COLA may double, since there is no cap on it. It is not likely that the Bureau of Labor Statistics, Department of Labor, which issues the quarterly CPI would have any difficulty in providing the Department of Defense with full data and conversion formulas needed to incorporate quarterly rises in the CPI into military pay raises.

Thus, not only has private industry made widespread use of the machinery of the cost of living adjustment but so has one of the largest employers in the federal sector. Indeed, within the month of April 1980, the steel industry and the United Steel Workers (AFL-CIO), as well as the giant International Harvester Company and United Automobile Workers, have signed national agreements with cost of living provisions that could range from 30 to 37 percent increases over the next three years, depending on the rate of inflation.¹¹

I point to these very recent collective bargaining agreements and their use of the COLA machinery out of my sense of urgency. We have had too many pay studies, too many pay bills that never had a chance, too many promises that were not kept. But now the hemorrhage of talent has struck the armed forces like a plague. The public is concerned. Noted conservative writers, who have been staunch supporters of the armed forces, such as William F. Buckley, are now writing articles expressing grave doubts about military pay and the loss of trained flying, maintenance, ordnance, and electronic personnel. Buckley asks why the reenlistment rate is declining to 36 percent and why enlisted personnel have to moonlight or go on food stamps to survive.¹²

pay parity for the armed forces

One other major reform, in addition to the adoption of a COLA adjustment, needs to be incorporated into any military compensation system. As Mr. Laird astutely argues, if NCOs and young officers are to be retained, then the 17 percent in real income that they have lost since 1972 must be restored.¹³ Once more, there exists in the Postal Service pay schedule an apparatus by which this can be quickly accomplished. The average grade level for the majority of postal workers is Grade 5. All NCOs from E-5 to E-9 should have their base pay adjusted to reflect parity with Level 5 pay of postal clerks and carriers with the same number of years of service. A wide pay gap of many thousands of dollars now exists. For instance, a technical sergeant (E-6) with eight years' service now earns about $10,922.40 per annum base pay, whereas a letter carrier earns more than $20,000. While it is important that we have good mail service and that our postal employees be treated fairly in terms of national priorities, the retention of key enlisted and officer personnel who are responsible for millions of dollars in equipment every day is of far greater importance to the well-being of this nation.

Enlisted personnel in the grades of E-1 through E-4, most of whom are nonprior service personnel (NPS), should have their basic pay tied to a parity with entry level pay at Grade 3 in the Postal Service, which would bring them up to a $14,000 entry rate. For those who argue that we must show fiscal restraint by depriving NPS personnel of a living wage in double-digit inflation, the answer lies in the astronomical costs involved in military training each year. Latest studies show that the armed services are spending $8 billion per year, including $2.6 billion for specialized skill training, $1.3 billion for recruit training, and other costs associated with informal acquisition of skills on the job may add another $3 billion for enlisted specialized training alone.¹⁴ A shift to a more career-intensive force would save over $1 billion per year. Present attrition and retention rates would bankrupt any private business. Added to this, we are talking about the future credibility of this nation and whether we can maintain our position of power as the bastion of the free world. If we can find the money for postal clerks, where there are fifty applicants, at least, for every opening and where every minute of work over 8 hours per day and 40 hours per week is paid for at the rate of time-and-one-half, then I think we have to find the dollars for the E-4 plane handler on the deck of the Nimitz who is putting in 16-hour days, handling F- 14 aircraft costing $25 million per plane, and who has not seen his family in more than six months.

Whatever the reason may have been for choosing a military career in 1953, today 90 percent of our airmen and other enlisted personnel are most concerned with future financial security. Pay is the most important factor persuading a second-or third-term NCO to leave the service. Those Pentagon leaders who have been told to muffle their criticism about pay, readiness, and the quality of the armed forces know that our national security and our position as a world power are at stake. Fiscal restraint at the cost of the welfare of our troops, while billions in increased costs are paid to contractors who intend to keep pace with inflation, is total counterproductive. All the hardware and weapon systems in creation will not help America if we lose the experienced talent to operate and maintain them.

The postal clerk or carrier can be trained in six weeks or less. Any high school student of average physical and mental capability could come in tomorrow and be as productive as most postal employees in even less than six weeks, considering the quality of postal service during the last decade. On the other hand, second and third-term NCOs with the technological skills and experience necessary to operate our sophisticated weapon systems, and who are eagerly recruited by defense contractors, are irreplaceable.

The decade of the 1980s has been ushered in with a number of challenges to American power and credibility in the world. The test that took place in the bleak desert at Tabas, Iran, was only one of many tests that will follow in this decade. Unlike our Soviet rivals, our nation has done little to build in our citizen an awareness of the vigilance and preparedness that will be necessary in the years ahead. From an early age, Russian youth are taught to pay tribute to the sacrifices made during wartime. In Soviet high schools, military training is carried out nationwide; there is a draft for all 18 year olds and compulsory reserve officer programs for those who attend the Soviet universities.¹⁵ Soviet youth from the age of 14 are encouraged to join the Voluntary Committee for Assistance to the Armed Forces, where they receive military and technical training in a combination 4-H, Boy Scouts, American Legion, and National Guard program. Youngsters are taught to drive and maintain military vehicles, to make parachute jumps, to operate and maintain radio and electronic equipment, and to fire weapons. In addition, each summer, high school boys are off to the equivalent of an American basic training camp. These activities are paid for not by the Ministry of Defense but by the Ministry of Education.¹⁶ While our Congress takes months to debate draft registration legislation, the Soviets are maintaining their armed forces at 4.5 million men. Conscripts total 1.7 million youths per year, and only 10 percent are deferred for any reason.¹⁷

While most military writers agree that reinstitution of the draft would be of very little help in strengthening United States Armed Forces, since we need career-oriented and highly trained personnel, still it is significant to observe Soviet intentions through the way they deal with military training.¹⁸

The machinery to turn this desperate situation around exists in government at present. The cost of living adjustment as now applied to the Postal Service and pay parity with Postal Service personnel would arrest this dangerous hemorrhage of talent and restore dignity and self-esteem to our armed forces personnel. It is ironic that the boiler technicians who were missing from the crew of the oilier Canisteo and caused it to he stood down earned an average of $12,000 per annum in the Navy and $23,000 in civilian life. Justice and equity cry out for change. National survival and the retaining of our place as a world power call for the adoption of the military compensation and benefits package recommended here. Action is essential now.

1. "Navy Takes Ship Out of Operation Because of Shortage of Key Personnel," New York Times, April 12, 1980, p. 14.

2. Melvin R. Laird, "People, Not Hardware," Armed Forces Journal International, March 1980, pp. 60-61.

3. R. C. Barnard, "Carter Tells DOD: Stop Complaining about Pay," Air Force Times, March 17, 1980, p. 1.

4. Laird, p. 61.

5. "Muffling the Drum," Air Force Times, March 24, 1980, p. 13; B. Callender, "Manning: Can Inflation Help? Air Force Times, April 14, 1980, p. 4.

6. DOD Regulation 143.1-143.4; S.274.

7. Bernard Wray, "Crisis in Labor Relations in the Federal Service," Brooklyn Law Review, Fall 1970, p. 97.

8. Comprehensive Statement on Postal Operations (Washington: Government Printing Office, January 1980), p. 5.

9. B. Herbert, "The Crippled Giant," Part VII of "Serving the Flag at the Poverty Level," New York Daily News, November 16, 1980, pp. 94-95.

10. Agreement between United States Postal Service and the Postal Unions, July 21, 1978-July 20, 1981, p. 12. "The base salary schedule provided for in this agreement shall be increased 1 cent per hour for each full 0.4 of a point increase in the applicable Index above the Base Index. . . . "

11. "Steelworkers and Producers Formally Sign a New 3 Year Pact," New York Times, April 18, 1980, p. A-18.

12. William F. Buckley, "Was There a Nail Missing? New York Post, April 26, 1980, p. 7.

13. Laird, p. 65.

14. R. Cooper, Military Manpower and the All-Volunteer Force (Santa Monica: Rand, 1978), pp. 343-45.

15. Hedrick Smith, The Russians (New York: Quadrangle/New York Times Co., 1976), pp. 314-20.

16. Ibid., p. 321.

17. M. Hunter, "Registration Bill Is Voted 8 to 4 by the Senate Panel," April 30, 1980, p. A-20: "Draft Registration Rejected by House," New York Times, September 13, 1979, p. A-1.

18. "Military Manpower Easier to Find in Sverdlovsk than in Walla Walla" New York Times, April 27, 1980, p. 10. cf. C. Lasch, The Culture of Narcissism (New York: W. W. Norton, 1978), p. 231.

Disclaimer

The conclusions and opinions expressed in this document are those of the author cultivated in the freedom of expression, academic environment of Air University. They do not reflect the official position of the U.S. Government, Department of Defense, the United States Air Force or the Air University.

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