A new Pentagon report sheds light on military compensation, revealing that the average earnings for enlisted personnel and officers are nearly on par with those in the civilian workforce.
Notably, junior enlisted service members earn more than the majority of their civilian peers who have similar levels of education and experience.
Insights from the Paid Compensation Review
This insight comes from the first volume of the 14th Quadrennial Review of Military Compensation, which reports that enlisted members with less than a decade of service make salaries that exceed the 90th percentile of civilians holding only a high school diploma.
For instance, the study finds that an enlisted member with five years of experience can typically expect to earn around $65,000—more than 90% of their civilian counterparts.
To draw these comparisons, researchers measured Regular Military Compensation (RMC), a comprehensive metric that includes base pay, Basic Allowance for Subsistence (BAS), and Basic Allowance for Housing (BAH).
RMC takes into account factors such as years of service and dependent status, providing a holistic view of military income.
The director of a prominent think tank in Washington D.C. pointed out that while the compensation is competitive, one must consider the heavy responsibilities assigned to junior enlisted members.
These service members often face tough sacrifices, including the risk of their own lives.
Impact of Recent Compensation Increases
This report follows a significant salary boost for junior enlisted troops, who received a 14.5% pay increase through the fiscal year 2025 national defense bill passed in December.
This raise stemmed from a bipartisan congressional recommendation aimed at improving service retention and addressing food insecurity issues commonly faced by enlisted personnel.
The analysis also highlights that mid-career and senior enlisted members enjoy favorable compensation compared to civilians at similar career stages.
While base salaries might appear comparatively low—for instance, a fifth-year enlisted member may earn around $40,000—adding allowances like BAH and BAS significantly inflates total annual compensation to about $61,776, closely matching the earlier noted figure of $65,000.
The report further indicates that an enlisted individual earning $65,000 would rank in the 92nd percentile among individuals with similar qualifications and experience.
While the report includes information on officer salaries, it also suggests that adjustments could enhance compensation for mid-level officers, making military careers more attractive for those transitioning from civilian roles.
According to a senior defense official, the Department of Defense offers a compensation package that remains competitive within the civilian job market.
However, there is always room for improvement that could enhance the overall experience for military personnel and their families.
Ongoing Evaluations and Strategic Adjustments
While proposals for increasing base pay were on the table, researchers determined that doing so may not be necessary at this juncture, given the current strong retention rates.
They emphasized the importance of exploring more cost-effective policy solutions to boost retention and performance without necessarily raising basic pay.
To better support military families, the review advocates for regular evaluations of quality-of-life metrics, covering areas like housing, food access, healthcare, childcare, and spouse employment.
These assessments could inform strategic investments in non-cash benefits.
Additionally, the report scrutinized the timing and methods of annual pay adjustments, urging the Department of Defense to take into account delays in data collection when responding to rapid economic changes or significant events, like the COVID-19 pandemic.
It recommended aligning pay increases with the start of the new fiscal year rather than adhering to a calendar year schedule.
Historically, service members in combat zones have enjoyed certain tax benefits and Additional Danger Pay.
However, the current report emphasizes the need for reevaluating these financial benefits as combat zone classifications evolve, proposing a consistent review of designations every five years in light of changing risk dynamics.
For hazardous pay eligibility, the review advises using a broader range of criteria beyond just casualty figures.
It suggests incorporating intelligence assessments, threat levels, and command advisories for a more accurate evaluation.
The study also finds that Defense Department housing allowances often exceed median civilian expenses for rent and utilities, particularly benefiting service members who have families.
For example, E-5 sergeants with dependents receive approximately 43% more in housing allowances compared to similar civilian households.
In summary, while the report indicates that military compensation remains competitive, it highlights the necessity for ongoing evaluations and adjustments.
Such efforts would ensure that pay structures continue to meet the unique challenges faced by service members, particularly amid changing economic conditions.
Source: Taskandpurpose