"RAND Arroyo Center."

"This research was … conducted within the RAND Arroyo Center’s Manpower and Training Program"--Preface.

Includes bibliographical references (p. 51).

Introduction -- Steady-State Retention and Cost Results -- Retention Results During the Transition Period -- Conclusion -- Appendix: Simulation Tables.

The Army asked the RAND Arroyo Center to analyze a proposal allowing vested reservists to receive military retirement benefits immediately upon retiring from the Selected Reserve, just as vested members of the active component (AC) today receive retirement benefits immediately upon retiring from the active component. The study team used RAND’s dynamic retention model to analyze the effects of this potential change on the size and experience mix of the Army reserve component (RC) (Army National Guard and Army Reserve) and the Army AC. This analysis was done for both enlisted personnel and officers and for both the steady state and the transition to it. For reservists with prior AC service, the analysis suggests that these potential changes to the retirement system would lead to higher RC participation in midcareer years and lower participation after retirement vesting, relative to the current system. For reservists with no prior AC service, RC participation would be largely unchanged. AC retention would be higher in midcareer years but lower prior to 20 years of service. Because these changes in AC retention are small, overall the RC retirement proposal is not likely to have an adverse consequence for the AC force. Army personnel costs would decrease by $800 million per year, mainly because the AC force would become more junior and its members would leave the Army with less seniority.

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