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    STATEMENT OF

  LIEUTENANT GENERAL GARRY L. PARKS

UNITED STATES MARINE CORPS

   DEPUTY COMMANDANT FOR MANPOWER AND RESERVE

  AFFAIRS

 18 JULY 2001

Mr. Chairman and members of the Subcommittee:

            I am pleased to appear before you today to discuss our Manpower budget as it relates to military personnel in the United States Marine Corps. In the active force, our current budget funds 17,888 officers and 154,712 enlisted. Roughly 70 percent of our Manpower Personnel budget funds basic pay and retired pay accrual. The remaining dollars fund such items as Basic Allowance for Housing (BAH), Permanent Change of Station (PCS) relocations, Subsistence and Social Security. This leaves roughly 7 tenths of 1 percent in the Manpower account to pay for discretionary items such as our Selective Reenlistment Bonus (SRB) or College Fund Recruitment programs.

  PAY & COMPENSATION

The Marine Corps appreciates the efforts the members of this committee have made to help raise the standard of living for our Marines. The President's budget will bolster readiness and improve morale. It is robust pay increases as seen in the President's budget that will help in this objective. In our exit surveys, compensation is one of the stronger reasons Marines decide not to reenlist. The $1B earmarked for basic pay will begin to make the needed adjustments to the pay table and help us move toward parity with market wages. The President's budget targets those areas of our population that have the biggest disparity with their civilian counterparts. Regular military compensation, basic pay, housing and subsistence allowances are all marked for improvement in fiscal year 2002. Those improvements will make a positive impact on the decision to stay by many of our Marines. This year we decrease the Out of Pocket (OoP) expense between current housing market costs and the housing allowance we pay our service members to 11.3 percent. We are on track to reduce OoP expense to zero by 2005. Additionally, the flexibility in the housing allowance rate-setting process was instrumental in meeting the needs of our Marines in southern California. That is, utility cost increases were forecasted in the fall of 2000 and the 2001 housing rates were adjusted to meet the rising costs.  

           RETENTION OVERVIEW

            A successful recruiting effort is merely the first step in the process of placing a properly trained Marine in the right place at the right time. The dynamics of our manpower system then must match skills and grades to our Commanders' needs throughout the operating forces. The Marine Corps endeavors to attain and maintain stable, predictable retention patterns. However, as is the case with recruiting, civilian opportunities abound for our Marines as private employers actively solicit our young Marine leaders for lucrative private sector employment. Intangibles - such as the desire to serve our nation and the satisfaction received from leadership responsibilities provided in our Corps - are a large part of the reason we retain the men and women who choose to continue to be Marines after their initial commitment. Concrete evidence of this is seen in our deployed units, which continually record the Corps' highest reenlistment rates. Retention success is also partly a consequence of the investment we make in supporting our operational forces - to give our Marines what they need to do their jobs in the field, as well as the funds we earmark for educating and training these terrific men and women.

Enlisted

            We are very mindful of enlisted retention issues. Our enlisted force is the backbone of our Corps and we make every effort to retain our best people. Although we are experiencing minor turbulence in some specialties, the aggregate enlisted retention situation is encouraging. Some shortages exist in high-tech MOSs that represent an important part of our war fighting capability, and these young Marines remain in high demand in the civilian sector.    

            We are a young force, making accessions a chief concern for manpower readiness. Of the 154,000 active duty enlisted force, over 23,000 are still teenagers - 108,000 are still on their first enlistment. In FY01, we will have reenlisted approximately 27% of our first term eligible population. These 6,069 Marines represent 100% of the Marines we need to transition into the career force, and marks the eighth consecutive year we will have achieved this objective. On balance, however, we have observed a slight increase in the number of first term Marines we need to reenlist each year. To counter this rising first term reenlistment requirement, we will focus greater attention on retaining Marines in their 8^th through 12^th years of service. One of the new initiatives we anticipate introducing in FY02 is a Subsequent Term Alignment Plan (STAP), which focuses on retaining experience. Due to the strong draw of civilian sector opportunity, we must elevate the importance of our career force by paying additional attention as well as resources to keep the experience level of our force on par with previous years.

This year we continue to see smaller first term non-EAS attrition rates, figures  similar to the lower attrition experienced in fiscal years 1999 and 2000 when compared to previous historical rates. The implementation of the Crucible and the Unit Cohesion programs are contributing to improved retention among our young Marines that are assuming the cultural values of the Corps earlier in their career. The impact of lower non-EAS attrition allowed us to reduce our accession mission in FY00 and FY01. This 'Good News' may allow us to do the same in FY02 if the attrition rate declines further. The 'Bad News' of this is that it has increased the cost of our Manpower account by increasing the average length of service of individual Marines. However, this is the type of bad news we don't mind having as these positive results have reduced the burden placed on our recruiters, as well as provided our force with extra experience.       

            In the larger context, we are extremely pleased with our recruiting and retention situation. We anticipate meeting our aggregate personnel objectives and we continue to successfully maintain the appropriate balance of first term and career Marines. The management of youth and experience in our enlisted ranks is critical to our success and we are extremely proud of our accomplishments. We attack our specialty shortages with the highly successful Selective Reenlistment Bonus (SRB) program. Shortages persist in some highly technical specialties, such as intelligence, data communications experts, and air command and control technicians. Currently, the Marine Corps has allotted $40M in SRB new payments to assist our reenlistment efforts in FY01. This program has significantly aided our reenlistment rates and improved retention for some of our critical skill shortages. In FY02 we have allotted $47M in new payments as a result of the recent $15M increase authorized for SRB in the President's budget. In FY01 we successfully initiated lump sum bonus payments increasing the net present value of the incentive and positively influencing highly qualified, yet previously undecided, personnel. It is a powerful incentive for the undecided to witness another Marine's reenlistment and award of SRB in the total amount.

Officers

            By and large, officer retention continues to experience success with substantive improvements in retention, beginning in FY00. Our FY01 results continue to reflect an overall officer attrition rate that is closer to our historical rates. We believe that the reduction of voluntary separations may be attributed to the congressionally approved compensation triad and the strategic, albeit limited, use of special pays. As with the enlisted force, we still have some skill imbalances within our officer corps, especially in the aviation specialties.

            Although we are cautiously optimistic, pilot retention remains a concern.    The FY01 Aviation Continuation Pay (ACP) plan has higher aggregate "take rates" than in previous years. Retaining aviators involves a concerted effort in multiple areas that have been identified as impacting an officer's decision to remain in the Marine Corps. Many recent FY00 and FY01 retention initiatives have made substantial corrective strides strengthening the Marine Corps' position toward retaining aviation officers (i.e., Marine Aviation Campaign Plan, and pay reform).    Supplementary pay programs such as ACP provide an additional incentive by lessening the significant difference between civilian airline and military compensation. We anticipate a significant return on our investment from ACP. In FY01 and FY02 we increased ACP by approximately $4M each year to focus on retaining our mid-grade aviators (junior majors and lieutenant colonels) and will continue to reevaluate our aviation retention situation to optimize all our resources.

  Overall, the Marine Corps officer and enlisted retention situation is very encouraging. Through the phenomenal leadership of our unit commanders, we will achieve every strength objective for FY01 and expect to start FY02 heading in the proper direction. Even though managing our retention success has offered new challenges such as maintaining the appropriate grade mix, sustaining quality accessions, and balancing occupational specialties, we will continue to press forward in order to overcome these obstacles. In this difficult recruiting/retention environment, the so-called "War for Talent," the Marine Corps remains optimistic about our current situation and expect these positive trends to continue.

FAMILIES

We believe that while we may recruit Marine-aspirants, we retain Marine families. Your support of our families' Quality of Life (QoL) has contributed to our retention success. Congressional support in allocating and sustaining resources for our bases and stations has a profound impact on our readiness. Our bases serve as a sanctuary for our families, a launching pad for our deployments, and they ensure our Marines have adequate space for training. We are not only focused on training but on learning and education as well. Expansion of our distance learning program to ensure that the greatest number of our high quality young men and women have the opportunity to pursue education is just one area of focus for the Marines. It is when our Marines are confident that the Corps' first instinct is to care for their welfare that they will concentrate on mission accomplishment. Families, in turn, are then more supportive of their Marine's career. Over the past years we have utilized our Marine Corps Community Services (MCCS) to better serve our Marines and their families. MCCS retains strong capabilities with programs focused on increasing the QoL of our Marines and their families.    

           The Marine Corps has always prided itself on its ability to do more with less.  This is reflected in that the Corps provides twenty percent of our nation's ground and aviation combat force with just six percent of the Department of Defense budget. Your Marine Corps remains strong and able to accomplish its mission, yet only a sustained increase in resources will yield the flexibility and resilience we need in both the short and long term. Our successes have been achieved by following the same core values today that gave us victory on yesterday's battlefields. With your support, we can continue to achieve our goals and provide our Marines with what they need to accomplish their tasks. Marines are proud of what they are doing. They are proud of the Eagle, Globe and Anchor and what it represents to our country. It is our job to provide for them the leadership, resources, QoL and moral guidance to carry our proud Corps forward. With your support, a vibrant Marine Corps will continue to meet our nation's call as we have for the past 225 years!

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