Economic stability in the military: A look at earnings variability among Army personnel

Abstract: RAND researchers assessed military earnings volatility using pay and personnel data from 2009 to 2020 for active-duty Army enlisted members and officers. Understanding the factors that contribute to earnings volatility can help inform policies and programs aimed at reducing the negative effects of volatility on military personnel and their families, including food insecurity. Researchers found that enlisted soldiers experienced more earnings volatility on average than officers relative to their monthly earnings; average volatility translated to a change in average monthly pay of $698 for enlisted personnel and a $771 change for officers. Greater volatility was associated with being more junior; having lower pay; changing locations; and experiencing changes in pay elements, such as bonuses. There is little evidence of large differences in earnings volatility based on the gender, race, or ethnicity of Army personnel, except for enlisted personnel who changed marital status. Researchers also found that volatility varies relatively little within an occupational group or with a change in deployment status. Future studies should estimate how earnings volatility is related to economic and food insecurity in the military and consider the extent to which better financial literacy, financial planning services, and savings mitigate that volatility. Future research should also identify a comparable population of civilians to assess how earnings volatility compares among military personnel and civilians.

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