A Review of the Military Basic Pay Table
Analysis in Support of the Fourteenth Quadrennial Review of Military Compensation
ResearchPublished Feb 25, 2025
In this report, the authors assess the basic pay tables of enlisted personnel and commissioned officers; evaluate the Employment Cost Index as a guide to the annual military pay raise, as well as alternatives; compare military pay with civilian earnings and evaluate the 70th percentile benchmark developed by the Ninth Quadrennial Review of Military Compensation in 2002; and assess pay for service members in critical specialties.
Rapid increases in inflation since 2020, a strong labor market, together with military recruiting struggles and reported food insecurity among military members, have put a spotlight on military compensation and on the foundational element of the compensation system, military basic pay. The National Defense Authorization Act for 2023 mandated a study of military basic pay, as does the charter of the 14th Quadrennial Review of Military Compensation, the White House–directed commission that studies military compensation. The Fourteenth Quadrennial Review of Military Compensation requested the RAND National Defense Research Institute to conduct such a study.
In this report, the authors assess the basic pay tables of junior, midcareer, and senior enlisted personnel and commissioned officers; evaluate the Employment Cost Index (ECI) as a guide to the annual pay raise, as well as alternatives; compare military pay, measured by regular military compensation, with civilian earnings and evaluate the 70th percentile benchmark developed by the Ninth Quadrennial Review of Military Compensation in 2002; and assess pay for service members in critical specialties and whether and how basic pay could be used to address personnel needs in these specialties.
The authors also review recent trends in the civilian labor market that might affect recruiting and retention outcomes and the adequacy of military basic pay; develop proposals for change, drawing from past studies and commissions that have assessed military compensation; present findings from discussions with subject-matter experts and a review of relevant academic literature; and analyze pay, personnel, and civilian labor market data.
Key Findings
- Average regular military compensation has exceeded the 70th percentile benchmark since the early 2000s; this finding suggests that a higher benchmark could be appropriate, although the services have experienced strong retention overall and methods other than pay, such as increasing advertising and the number of recruiters, are more cost-effective recruiting resource tools.
- None of the various proposals that target pay for junior enlisted personnel dominates in terms of its effects on recruiting, retention, cost, efficiency, and pay compression; the best proposal depends on the problem that the Department of Defense (DoD) is trying to solve.
- All of the proposals that target basic pay for midcareer and senior enlisted personnel and officers would improve retention and performance incentives, but they would also increase personnel costs.
- The lack of timeliness of the current ECI, which has a 15-month time lag, affects service members during times of inflation; an alternative that would rely on a more recent ECI would improve timeliness.
- The accuracy of the ECI could be improved with an alternative that better reflects the civilian alternatives of military personnel. However, such an alternative could be more volatile and would not improve timeliness.
- Special and incentive (S&I) pays are highly targeted, with only a small share of occupations showing a high incidence of them, and cash compensation is uniformly higher for critical skills.
- The current system of S&I pays is generally viewed by subject matter experts as adequately addressing the need for wage differentials in critical skills occupations.
Related Content
Topics
Document Details
- Copyright: RAND Corporation
- Availability: Available
- Year: 2025
- Print Format: Paperback
- Paperback Pages: 230
- Paperback Price: $83.00
- Paperback ISBN/EAN: 1-9774-1432-X
- DOI: https://doi.org/10.7249/RRA2400-1
- Document Number: RR-A2400-1
Citation
RAND Style Manual
Asch, Beth J., Michael G. Mattock, Jason M. Ward, Samuel Absher, Patricia K. Tong, and Anton Shenk, A Review of the Military Basic Pay Table: Analysis in Support of the Fourteenth Quadrennial Review of Military Compensation, RAND Corporation, RR-A2400-1, 2025. As of April 30, 2025: https://www.rand.org/pubs/research_reports/RRA2400-1.html
Chicago Manual of Style
Asch, Beth J., Michael G. Mattock, Jason M. Ward, Samuel Absher, Patricia K. Tong, and Anton Shenk, A Review of the Military Basic Pay Table: Analysis in Support of the Fourteenth Quadrennial Review of Military Compensation. Santa Monica, CA: RAND Corporation, 2025. https://www.rand.org/pubs/research_reports/RRA2400-1.html. Also available in print form.
Research conducted by
This research was sponsored by the 14th Quadrennial Review of Military Compensation and conducted within the Personnel, Readiness, and Health Program of the RAND National Security Research Division.
This publication is part of the RAND research report series. Research reports present research findings and objective analysis that address the challenges facing the public and private sectors. All RAND research reports undergo rigorous peer review to ensure high standards for research quality and objectivity.
This document and trademark(s) contained herein are protected by law. This representation of RAND intellectual property is provided for noncommercial use only. Unauthorized posting of this publication online is prohibited; linking directly to this product page is encouraged. Permission is required from RAND to reproduce, or reuse in another form, any of its research documents for commercial purposes. For information on reprint and reuse permissions, please visit www.rand.org/pubs/permissions.
RAND 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.