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Previous retention research has concentrated on military/civilian pay levels and has largely ignored changes in military promotion timing. Over the past several years, promotion tempo has slowed considerably in the enlisted force; the implications of the slowdown, however, have received little attention. This report examines factors that affect promotion timing during the first enlistment term and examines how changes in promotion tempo affect the first-term retention decision. The authors developed and estimated a joint, integrated model of promotion and first-term retention behavior and compare the results with those from previous approaches that use little (if any) promotion information. The results demonstrate that retention models are sensitive to the specification of individual promotion opportunities at the end of the first term. The approach also shows that several key parameters of traditional models have been misleading because they have not adjusted for promotion timing. The authors conclude that soldiers are quite sensitive to promotion tempo and that promotion could be used to complement military pay and bonus policies in retaining quality personnel in hard-to-fill skills. Promotion policy should be an important part of any compensation package. Finally, they suggest that the services not rely on reduced promotion tempo to induce lower retention during the planned military drawdown.

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