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Current estimates comparing wage growth in the military and civilian sectors suggest that military basic pay grew 11.8 percent slower than civilian wages from fiscal 1982 to 1991. Yet over the same period recruit quality and retention showed practically no sign of deterioration. The authors developed a new civilian wage index (the DECI) for military personnel designed to represent the active duty military population and its civilian wage opportunities, and found only a 4.7 percent deficit over that period. DECI relative wage growth patterns track accession and retention trends over the period better than the currently used index, the ECI (Employment Cost Index). The DECI also shows how the military/civilian pay gap varies among different subgroups in the military — young, high school only graduates show parity while older, more educated personnel show a deficit; enlisted personnel show parity while officer personnel show a deficit. Subgroup comparisons demonstrate the DECI's potential to provide specific information to those who manage and set policy for military personnel.

This report is part of the RAND Corporation report series. The report was a product of the RAND Corporation from 1948 to 1993 that represented the principal publication documenting and transmitting RAND's major research findings and final research.

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.