The Effect of Military Enlistment on Earnings and Education

by David S. Loughran, Paco Martorell, Trey Miller, Jacob Alex Klerman

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Abstract

Each year, more than 150,000 young men and women enlist in the active component of the U.S. military. The experience of these enlistees while serving their country undoubtedly influences their long-run labor market outcomes, but exactly how is not well understood. Military service develops technical and other skills and subsidizes the cost of postsecondary education, but military experience does not perfectly substitute for civilian labor market experience. The research reported in this volume estimates, for as many as 18 years following enlistment, the causal effect of military service on labor market and educational outcomes. The authors address the empirical problems associated with the selective nature of military service by restricting their analysis to military applicants, some of whom enlist and some of whom do not, and by controlling for a rich array of applicant characteristics available on the military application record. The authors find that military enlistment increases earnings in both the short and long term: The percentage increase in earnings attributable to enlistment is about 40 percent in the first few years following application and diminishes to about 11 percent 14–18 years following application. Enlistment significantly delays college education in the short run. In the longer run, enlistment slightly increases the likelihood of attaining a two-year college degree, but it also decreases the likelihood of attaining a four-year college degree, especially among higher-aptitude youth.

Table of Contents

  • Chapter One

    Introduction

  • Chapter Two

    Methods and Data

  • Chapter Three

    The Effect of Army Enlistment on Labor Market Earnings

  • Chapter Four

    The Effect of Army Enlistment on Educational Attainment

  • Chapter Five

    Conclusion

  • Appendix

    The Effect of Enlistment on Labor Market Earnings: All Services

The research described in this report was sponsored by the United States Army and conducted by the RAND Arroyo Center

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