Defense Downsizing

An Evaluation of Alternative Voluntary Separation Payments to Military Personnel

by David W. Grissmer, Richard Eisenman, William W. Taylor

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This report documents RAND’s research effort on one aspect of the personnel drawdown — how to structure voluntary separation offers to service members to efficiently meet force-reduction objectives. This research was carried out before development of the voluntary separation programs initiated between 1992 and 1994 and was instrumental in shaping them. The authors address the question of what part of the reductions should come from lowered accession levels and what part from increased separations of personnel currently in the service. They identify the criteria that any separation plan should meet and develop a methodology for estimating the acceptance rate of voluntary separation offers. They apply this methodology to evaluate a range of such offers and then address the process of how to structure separation offers to get both the number and type of desired departures as cost effectively as possible. Finally they address questions concerning the financing of such offers by estimating the savings from reduced retirement outlays.

This report is part of the RAND Corporation Monograph report series. The monograph/report was a product of the RAND Corporation from 1993 to 2003. RAND monograph/reports presented major research findings that addressed the challenges facing the public and private sectors. They included executive summaries, technical documentation, and synthesis pieces.

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