Considering a Cadre Augmented Army - RAND Corporation
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Considering a Cadre Augmented Army - RAND Corporation

Considering a Cadre Augmented Army - RAND Corporation Considering a Cadre Augmented Army - RAND Corporation

rand.org
07.06.2014 Views

-242- An Operational Analysis of Cadre Figure B.3—Trend in Annual Basic Pay vs. Total Compensation for Enlisted Personnel 25% 20% Annual Total Compensation DOA (2007) 15% 10% 5% 0% ` Annual Total Compensation CBO (2007) E-1 to E-2 E-2 to E-3 E-3 to E-4 E-4 to E-5 E-5 to E-6 E-6 to E-7 E-7 to E-8 E-8 to E-9 Pay Grade Jump Figure B.3 shows that our estimate for enlisted personnel compensation by grade is similar to that in CBO (2007b). The percentage increase in total compensation is slightly higher in our model because the CBO (2007b) calculation includes additional cost components (veterans’ health accrual, tax benefits) that increase the overall cost in each grade but do not increase significantly from grade to grade. This explains the lower percentage increase in cost in CBO (2007). These differences have a slight effect on the relative cost results reported in this paper. The higher the average increase in compensation, the higher the relative cost of a cadre BCT because it retains personnel in higher grades. Therefore, the compensation model used in this paper slightly overestimates the relative cost of a cadre unit during peacetime. To get a sense of the magnitude of this overestimation, we calculated the relative cost of just the enlisted personnel in each of the five cadre BCT types for both our cost model and that in CBO (2007b). Table B.2 shows the results. Table B.2—Cadre Unit Enlisted Relative Cost under Different Compensation Models Cadre Force Our Model CBO (2007b) All NCOs 47 % 46 % Senior NCOs 26 % 25 %

-243- An Operational Analysis of Cadre Increase Promotion (9 BCT) 20 % 19 % Activate IRR (9 BCT) 24 % 23 % Combination (9 BCT) 18 % 17 % We can see from Table B.2 that our model slightly overestimates the cost of the enlisted component of a cadre unit relative to CBO (2007b). This overestimation is very small- one percent for each of the cadre forces examined here. This slight difference is likely to occur for officers and warrant officers as well. B.2—INTERGRATING PEACETIME DUTIES AND COST After calculating the relative difference in cost between a cadre and AC unit, we calculate the overall cost of the cadre unit by multiplying the relative cost as calculated in Section B.1 by the percentage of the peacetime cost of the cadre leaders that are assigned to the cadre unit. Assigning different peacetime duties to cadre leaders results in varying relative cost estimates. For instance, a foreign training cadre unit might spend only 25 percent of its time performing cadre duties in peacetime with the rest of its time spent on foreign training missions. Therefore, we assign only 25 percent of the relative cost of the cadre leaders to the cadre unit. We do this by multiplying the relative cost of the cadre unit by the percentage of time the cadre is performing cadre duties. If a cadre unit with all officers and NCOs, which costs 56 percent of an AC unit, was assigned foreign army training duties in peacetime with only 25 percent of its time assigned to the cadre unit, the relative cost of the cadre unit falls to 14 percent (0.25*0.56) of an AC unit. Chapter Three of this paper performs this calculation for various combinations of peacetime structures and duties.

-242- An Operational Analysis of <strong>Cadre</strong><br />

Figure B.3—Trend in Annual Basic Pay vs. Total Compensation for Enlisted<br />

Personnel<br />

25%<br />

20%<br />

Annual Total Compensation<br />

DOA (2007)<br />

15%<br />

10%<br />

5%<br />

0%<br />

`<br />

Annual Total Compensation<br />

CBO (2007)<br />

E-1 to E-2 E-2 to E-3 E-3 to E-4 E-4 to E-5 E-5 to E-6 E-6 to E-7 E-7 to E-8 E-8 to E-9<br />

Pay Grade Jump<br />

Figure B.3 shows that our estimate for enlisted personnel compensation by grade is<br />

similar to that in CBO (2007b). The percentage increase in total compensation is slightly<br />

higher in our model because the CBO (2007b) calculation includes additional cost<br />

components (veterans’ health accrual, tax benefits) that increase the overall cost in each<br />

grade but do not increase significantly from grade to grade. This explains the lower<br />

percentage increase in cost in CBO (2007). These differences have a slight effect on the<br />

relative cost results reported in this paper. The higher the average increase in compensation,<br />

the higher the relative cost of a cadre BCT because it retains personnel in higher grades.<br />

Therefore, the compensation model used in this paper slightly overestimates the relative cost<br />

of a cadre unit during peacetime. To get a sense of the magnitude of this overestimation, we<br />

calculated the relative cost of just the enlisted personnel in each of the five cadre BCT types<br />

for both our cost model and that in CBO (2007b). Table B.2 shows the results.<br />

Table B.2—<strong>Cadre</strong> Unit Enlisted Relative Cost under Different Compensation<br />

Models<br />

<strong>Cadre</strong> Force Our Model CBO (2007b)<br />

All NCOs 47 % 46 %<br />

Senior NCOs 26 % 25 %

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