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The Declining Share of Veterans Among Prime-Age Men: The Centennial of Armistice Day

Summary:
The armistice marking the end of World War I was signed on November 11, 1918. A year later--and 100 years ago today--the first Armistice Day celebrations were held at Buckingham Palace. The US Congress passed a resolution commemorating Armistice Day in 1926, and it became a national holiday in 1938. In 1954, after World War II, its name was changed to Veteran's Day in the United States.But as you may have noticed when attending an event where veterans are encouraged to stand and be recognized for their service, the share of "prime-age" men (a term economists use to describe those in main working years from ages 25-54) who served as veterans has been in sharp decline.Coile, Courtney C. Coile and Mark G. Duggan raise this issue in passing in a Spring 2019 essay in the Journal of Economic

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The armistice marking the end of World War I was signed on November 11, 1918. A year later--and 100 years ago today--the first Armistice Day celebrations were held at Buckingham Palace. The US Congress passed a resolution commemorating Armistice Day in 1926, and it became a national holiday in 1938. In 1954, after World War II, its name was changed to Veteran's Day in the United States.

But as you may have noticed when attending an event where veterans are encouraged to stand and be recognized for their service, the share of "prime-age" men (a term economists use to describe those in main working years from ages 25-54) who served as veterans has been in sharp decline.

Coile, Courtney C. Coile and Mark G. Duggan raise this issue in passing in a Spring 2019 essay in the Journal of Economic Perspectives ("When Labor's Lost: Health, Family Life, Incarceration, and Education in a Time of Declining Economic Opportunity for Low-Skilled Men," 33:2, 191-210). They write:

[W]e call attention to perhaps the most significant change among prime-age men in recent decades. In 1980, fully 45 percent of prime-age men reported in the Bureau of Labor Statistics’ monthly Current Population Survey said that they had previously served in the military. This number steadily declined during the next 36 years and stood at just 10 percent by 2016 in this same survey.
Of course, a major reason for this shift is because of the end of the military draft in 1973, a change in which the arguments and projections of economists about how an all-volunteer military force could function played a substantial role (for a background essay, see John T. Warner and Beth J. Asch, "The Record and Prospects of the All-Volunteer Military in the United States," Journal of Economic Perspectives, Spring 2001, 15:2,  pp. 169-192).

What do we know about the effects of this dramatic social change? Coile and Duggan write:

Much of the economics literature has examined the effect of military service by using plausibly exogenous variation in the likelihood of service driven by one’s draft lottery number (Angrist 1990). This research has tended to find quite modest long-term effects of military service on employment, earnings, and health status (for example, Angrist, Chen, and Frandsen 2010; Angrist, Chen, and Song 2011). However, these studies are unable to capture the peer effects or general equilibrium effects of military service. Recent research has suggested substantial gains to cognitive and noncognitive skills stemming from military service (Spiro, Stetterson, and Aldwin 2015) and associated benefits such as the GI bill. Overall, we see a strong need for further work to investigate how changing economic opportunities, declines in military service, and other factors are contributing to or cushioning the problems of low-skilled prime-age men.
This shift away from shared military experience is a large and probably understudied social shift. Many of those who served in the armed forces, and survived, have lasting personal ties both to those they knew and to others who shared the experience.

My suspicion is that the effects of military service in later life are probably quite different between the days of the draft and the all-volunteer force. For example, during the draft pay could be relatively low and there was not much reason for the armed forces to invest in the human capital of new soldiers, most of whom would be out of military service in a few years. With the all-volunteer force, pay had to be somewhat higher and the armed forces had to focus on training and incentives for retention. When big US companies need a new CEO, they can do a job search outside their own firm. But when the armed forces needs a new general or admiral, they have to promote from within.

There are occasional proposals for a national service requirement, proposals which in their rhetoric sometimes piggyback on the strong positive feelings many of us have about veterans. But I'm old enough to have grown up in the aftermath of the Vietnam-era military draft, and it would be a dramatic understatement to say that the draft was unpopular.  My own cynical observation about national service proposals is that it's a case of middle-aged and elderly people voting on which young adults are eligible for exceptions and loopholes, and how the others will be required to spend a couple of years of their lives in low-cost labor. In an odd way, I'd be marginally more sympathetic to a national service proposal requiring, say, that everyone between the ages of 30 and 50 needs to take two years out of their life for full-time, low-wage labor. After all, wouldn't these ages be potentially an even more productive time to "foster unity" and "build bridges" and "bring people together," and all the other claims made for a national service requirement? Or perhaps members of Congress could require that they personally each spend one month out of every two years in a full-time, away-from-home national service requirement.

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