Cost‐efficient military recruiting: An econometric approach

Abstract

The near‐term likelihood of declining military manpower requirements, and of consequently reduced military budgets, will put pressure on recruitment agencies to become more cost‐efficient, or to cut back, or both. In this paper we illustrate the working of an econometric model designed to measure the cost‐efficiency of the US Army recruiting process, and to project cost‐efficient responses to expected future reductions in manpower requirements. The model assumes that the United States Army Recruiting Command attempts to minimize the cost of meeting recruiting targets, but it allows for failure, and it generates measures of the magnitude, the direction, and the cost of any such failure. The model is estimated on US Army recruiting data for CY1986‐CY1987, validated, then re‐estimated for CY1986‐CY1988, and used to project cost‐efficient responses to anticipated declines in recruiting targets.