A Predictive Model of Navy Second-Term Retention,

Abstract : From FY 1992 to FY 1994, the Navy's Zone B retention rate for enlisted personnel fell by 13 percentage points. Zone B refers to sailors in their seventh to tenth year of service. The Center for Naval Analyses (CNA) studied this drop in retention and found that the FY 1994 rate was about 5 percentage points below the rate projected in the post-drawdown steady state. The study also concluded that Navy draw-down policies could explain 8 percentage points of the 13-point decline in retention seen between FY 1992 and FY 1994. Of those 8 points, 2.5 were attributed to monetary separation incentives. However, the effects of any Navy policy are difficult to pinpoint because of the large number of factors at play that also affect retention. For example, the drawdown coincided with an upturn in the civilian economy, which may have also contributed to the drop in retention from FY 1992 to FY 1994. In response, N1 tasked CNA to develop a predictive model that would: (1) Provide a general foundation for analysts to relate changes in Zone B retention to changes in Navy policy and in the career and personal characteristics of enlisted personnel; and (2) Quantify the effect of drawdown programs on the recent drop in Zone B retention.