You're Not in the Army Now

By Ettorre, Barbara | Management Review, December 1992 | Go to article overview

You're Not in the Army Now


Ettorre, Barbara, Management Review


The U.S. armed services have been undergoing such a massive downsizing that their veterans are in danger of joining new ranks: the unemployed. The U.S. military is nothing if not a planner, but it could not prevent the simultaneous occurrence of the biggest military downsizing and the deepest economic malaise in post-World War II history.

The downsizing--called a build-down or a draw-down in military jargon--has been well documented, as both the U.S. Congress and the American public have waited patiently for the so-called economic peace dividend to kick in after the dismantling of communism in the former Soviet Union and Eastern Europe.

The facts, indeed, indicate a formidable U.S. military reduction:

* From 2.17 million active-duty personnel at the end of fiscal 1987, the military will consist of 1.64 million at the end of fiscal 1995--a 24 percent drop representing some 530,000 people. Ordinary annual military turnover is 15 percent, so this represents a sizable increase. . The rolls of related civilian workers in the Department of Defense, some 1.13 million as of fiscal 1987, will be reduced to 912,000 by 1995. They don't include the approximately 1 million employees downsized by major corporations that are government contractors.

* There were 800 U.S. installations, many of them bases, before the build-down; there are now 481. The Army is going from 18 activeduty divisions to 12. The Navy is reducing itself from 550 ships in 1989 to 450 by the end of fiscal 1995.

* The military is spending $2.5 billion from 1992 to 1995 on various voluntary separation incentives and on special separation bonuses. It is also spending $60 million a year from 1991 to 1995 on transition assistance for personnel and their families, including job search assistance for the prospective veterans.

A Look at the Army

Of the five services, the Army, as the largest, is doing the most. "The Army is defined as people working with equipment, not people being put onto or into equipment--as with pilots on planes or sailors on ships;' says Adjutant General Jo B. Rusin at U.S. Army Forces Command. "Because, by definition, our tasks require more people, we have to downsize the most;' she adds.

In fact, the Army alone will account for 245,000 of the personnel build-down by the end of fiscal 1995. The famed VII Corps, for example, so visible during Desert Storm, exists no more. The Army has lost almost 30 percent of its operating budget for installations and almost 25 percent of its supporting civilian workforce, according to General Edwin H. Burba Jr., commander of U.S. Army Forces Command and the person in charge of training and maintaining combat-ready troops in the continental United States.

Army operations in Europe, too, are downsizing. Robert S. Silberman, Assistant Secretary of the Army for manpower and reserve affairs, notes that each day 550 separated Army personnel and their families are flown back to the States in two 747s.

Lt. General William G. "Gus" Pagonis, commander of the 21st Theater Army Area Command and the senior U.S. Army logistician in Europe, reports that as of August 1992, the Army has shifted 85,677 soldiers, 31,800 cars, 97,800 family members--and 25,560 pets--out of Europe. Gen. Pagonis, the chief 1ogistician during the Gulf war, is the author, with Jeffrey L. Cruikshank, of Moving Mountains: Lessons in Leadership and Logistics from the Gulf War (Harvard Business School Press, 1992).

The downsizing involves crucial management issues, and the Army is eager to discuss them. A policy forum on business and the returning soldier was held in October in Atlanta and was conducted by the U.S. Army and the Committee for Economic Development (CED), a think tank of 250 corporate leaders and academics. The geographical area was important: One-third of the active-duty Army in the United States is based in an eight-state

Southeast area. …

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