United States Government Accountability Office

GAO Testimony 

Before the Subcommittee on Military 

Personnel, Committee on Armed Services, 

House of Representatives 

MILITARY PERSONNEL

DOD Needs to Provide a 

Better Link between Its 

Defense Strategy and 

Military Personnel 

Requirements 

Statement of Janet A. St. Laurent, Director 

Defense Capabilities and Management 

For Release on Delivery

Expected at 2:00 p.m. EST 

Tuesday, January 30, 2007 

 

GAO-07-397T 
What GAO Found

United States Government Accountability Office

Why GAO Did This Study

Highlights

Accountability Integrity Reliability

January 30, 2007

MILITARY PERSONNEL

DOD Needs to Provide a Better Link 

between Its Defense Strategy and Military 

Personnel Requirements 

Highlights of GAO-07-397T, a testimony 

before the Subcommittee on Military

Personnel, Committee on Armed Services, 

House of Representatives

The war in Iraq along with other

overseas operations have led to

significant stress on U.S. ground

forces and raised questions about 

whether those forces are

appropriately sized and structured. 

In 2005, the Department of Defense 

(DOD) agreed with GAO’s 

recommendation that it review 

military personnel requirements. 

The Office of the Secretary of 

Defense (OSD) concluded in its 

2006 Quadrennial Defense Review

(QDR) that the number of active 

personnel in the Army and Marine

Corps should not change. 

However, the Secretary of Defense 

recently announced plans to 

increase these services’ active end 

strength by 92,000 troops. Given 

the long-term costs associated with

this increase, it is important that 

Congress understand how DOD 

determines military personnel 

requirements and the extent of its 

analysis. 

GAO has issued a number of 

reports on DOD’s force structure 

and the impact of ongoing 

operations on military personnel, 

equipment, training, and related 

funding. This statement, which 

draws on that prior work, focuses 

on (1) the processes and analyses 

OSD and the services use to assess 

force structure and military 

personnel levels; (2) the extent to

which the services’ requirements 

analyses reflect new demands as a

result of the changed security

environment; and (3) the extent of

information DOD has provided to

Congress to support requests for 

military personnel. 

Both OSD and the military services play key roles in determining force 

structure and military personnel requirements and rely on a number of 

complex and interrelated analyses. Decisions reached by OSD during the 

QDR and the budget process about planning scenarios, required combat 

forces, and military personnel levels set the parameters within which the 

services can determine their own requirements for units and allocate 

military positions. Using OSD guidance and scenarios, the Army’s most 

recent biennial analysis, completed in 2006, indicated that the Army’s total

requirements and available end strength were about equal. The Marine 

Corps’ most recent assessment led to an adjustment in the composition and 

mix of its units. 

Both the Army and Marine Corps are coping with additional demands that 

may not have been fully reflected in OSD guidance, the QDR, or in recent 

service analyses. First, the Army’s analysis did not fully consider the impact 

of converting from a division-based force to modular units, partly because 

modular units are a new concept and partly because the Army made some 

optimistic assumptions about its ability to achieve efficiencies and staff 

modular units within the QDR-directed active military personnel level of 

482,400. Second, the Army’s analysis assumed that the Army would be able 

to provide 18 to 19 brigades at any one time to support worldwide 

operations. However, the Army’s global operational demand for forces is

currently 23 brigades and Army officials believe this demand will continue 

for the foreseeable future. The Marine Corps’ analyses reflected some new 

missions resulting from the new security environment. However, the 

Commandant initiated a new study following the 2006 QDR partly to assess

the impact of requirements for a Special Operation Command. 

Prior GAO work has shown that DOD has not provided a clear and 

transparent basis for military personnel requests that demonstrates how they 

are linked to the defense strategy. GAO believes it will become increasingly 

important to demonstrate a clear linkage as Congress confronts looming 

fiscal challenges facing the nation and DOD attempts to balance competing 

priorities for resources. In evaluating DOD’s proposal to permanently 

increase active Army and Marine Corps personnel levels by 92,000 over the 

next 5 years, Congress should carefully weigh the long-term costs and 

benefits. To help illuminate the basis for its request, DOD will need to 

provide answers to the following questions: What analysis has been done to 

demonstrate how the proposed increases are linked to the defense strategy? 

How will the additional personnel be allocated to combat units, support 

forces, and institutional personnel, for functions such as training and 

acquisition? What are the initial and long-term costs to increase the size of 

the force and how does DOD plan to fund this increase? Do the services 

have detailed implementation plans to manage potential challenges such as 

recruiting additional personnel, providing facilities, and procuring new 

equipment? 

www.gao.gov/cgi-bin/getrpt?GAO-07-397T.

To view the full product, click on the link 

above. For more information, contact Janet 

A. St. Laurent at (202) 512-4402 or

stlaurentj@gao.gov. 
Mr. Chairman and Members of the Subcommittee: 

I am pleased to be here today to discuss the Department of Defense’s 

(DOD) processes for determining force structure and military personnel 

requirements for the Army and Marine Corps. The war in Iraq, along with 

continuing operations in Afghanistan and elsewhere in the world, have led

to significant stress on U.S. ground forces and have raised questions about 

whether they are appropriately sized and structured to meet the demands 

of the new security environment. Units are being tasked to stay in theater 

longer than anticipated, and some personnel are now embarking on their 

third overseas deployment since 2001. Although the department’s 2006 

Quadrennial Defense Review (QDR) concluded that the Army and Marine

Corps should plan to stabilize at a level of 482,400 and 175,000 active 

military personnel respectively, the Secretary of Defense recently 

announced plans to permanently increase the size of the active Army and

Marine Corps by a total of 92,000 troops over the next 5 years. Given the 

significant long- term costs associated with such an increase, it is 

important to understand how DOD determines military personnel 

requirements and the extent to which requirements are based on rigorous

analysis. As our prior work has shown, valid and reliable data about the 

number of personnel required to meet an agency’s needs are critical 

because human capital shortfalls can threaten an organization’s ability to

perform missions efficiently and effectively. This is particularly true for 

the DOD, where the lack of rigorous analysis of requirements could have 

significant consequences for military personnel called upon to execute

military missions or, alternatively, could lead to inefficiencies in allocating 

funds within the defense budget. 

My testimony today will focus on three issues: (1) the processes and 

analyses used by the Office of the Secretary of Defense (OSD) and the 

Army and Marine Corps to assess force structure and military personnel 

levels; (2) the extent to which the services’ recently completed 

requirements analyses reflect new demands resulting from the changed 

security environment; and (3) the extent of information provided to 

Congress to support the department’s requests for military personnel. In 

light of the recent proposal to permanently increase the size of the Army 

and Marine Corps, my comments will focus largely on requirements for 

active personnel, although the service requirements process I will be 

discussing apply to both the active and reserve components, and our prior 

work has shown that ongoing operations have taken a toll on the reserve 

components as well. A congressionally-mandated commission has been 

tasked to conduct a comprehensive examination of how the National 

Page 1 GAO-07-397T 
Guard and Reserve are used in national defense. This commission’s work 

is still ongoing. 

My testimony today is based primarily on our past work on Army and 

Marine Corps force structure and military personnel issues as well as our 

work on human capital and military personnel issues defensewide. A list 

of our past reports can be found in the Related GAO Products section at 

the end of this statement. We updated some of our information during 

recent discussions with Army and Marine Corps officials. To obtain these

updates we interviewed officials and obtained documents from 

Headquarters, Department of the Army; the U.S. Army Center for Army 

Analysis; Headquarters Marine Corps, Manpower and Reserve Affairs; and 

the Marine Corps Combat Development Command. To assess the 

processes and analyses used by the Office of the Secretary of Defense and 

the Army and Marine Corps to assess force structure and military 

personnel levels, we relied on our past reports on these subjects, as well 

as updated information from Total Army Analysis 08-13 and Marine Corps 

force structure plans from the sources noted. To assess the extent to 

which the services’ recently completed requirements analyses reflect new 

demands resulting from the changed security environment, we relied on 

our past work, DOD’s February 2006 Quadrennial Defense Review report, 

the Secretary of Defense’s congressional testimony announcing his 

proposal to increase Army and Marine Corps force levels, and Total Army 

Analysis 08-13 and Marine Corps force structure plans. To assess the 

extent of information provided to Congress to support the department’s 

requests for military personnel, we relied on our past reporting on human 

capital and end strength issues. 

Summary Both OSD and the military services play key roles in determining force 

structure and military personnel requirements and rely on a number of 

complex and interrelated processes and analyses—rather than one clearly 

documented process. Decisions reached by OSD in the QDR, and in budget 

and planning guidance, often set the parameters within which the services 

can determine their own force structure requirements and allocate military 

personnel to meet operational and institutional needs. For example, the 

2006 QDR determined that the Army would have 42 active combat 

brigades and 482,400 active military personnel, and these numbers are a 

“given” in the Army’s biennial force structure analysis. A major purpose of 

the Army’s biennial analysis is to determine the number and types of 

support forces, such as transportation companies and military police units, 

to support combat forces. Also, if total support force requirements exceed 

available military personnel levels approved by OSD, the process helps the 

Page 2 GAO-07-397T 
Army determine where to accept risk. The Army’s most recent biennial 

force structure analysis indicated that its total requirements and available 

military personnel levels (for all components) were about equal, although 

the Army decided to reallocate many positions to create more highdemand units, such as military police, and reduce numbers of lesser 

needed units. Similarly, the Marine Corps uses a number of modeling, 

simulation, and other analytical tools to identify gaps in its capabilities to

perform its missions, to identify the personnel and skills needed to provide 

the capabilities using professional judgment, and to assess where to 

accept risk. The Marine Corps has also made changes to the composition 

and mix of its units as a result of its analyses. 

Both the Army and Marine Corps are coping with additional demands that 

may not have been fully reflected in the 2006 QDR or in recent service 

analyses that were based on OSD guidance. These analyses predate the 

Secretary of Defense’s recent announcement to increase Army and Marine 

Corps forces by 92,000. However, some of this work, and our own 

assessments, are only months old and should provide a useful baseline for

helping the committee understand what has changed since the 2006 QDR 

and service analyses were completed. First, the Army’s most recent 

analysis did not fully consider the impact of converting from a divisionbased force to modular brigades. The Army’s recent analysis recognized 

that modular units would require greater numbers of combat forces than 

its prior division-based force and assumed this could be accomplished by 

reducing military positions in the Army’s institutional forces, such as its 

command headquarters and training base, rather than increasing the size 

of the active force. In September 2006, we questioned whether the Army 

could reduce sufficient numbers of military positions in the institutional 

force and meet all of its modular force requirements with the QDRdirected active end strength of 482,400. Second, the Army’s analysis 

assumed that the Army would be able to provide 18 to 19 brigades at any

one time (including 14 active and 4 to 5 National Guard brigades) to 

support worldwide operations. However, the Army’s global operational 

demand for forces is currently 23 brigades and Army officials believe this 

demand will continue for the foreseeable future. The Marine Corps is also 

supporting a high pace of operations that may not have been fully 

reflected in its recent analyses. For example, the 2006 QDR directed the 

Marine Corps to stand up a Special Operations Command requiring about 

2,600 military personnel, but did not increase the size of the Marine Corps 

to reflect this new requirement. The Marines also are experiencing a

higher operational tempo than anticipated and standing up specialized 

units to train Iraqi forces, which may not have been fully envisioned in 

their earlier analyses. 

Page 3 GAO-07-397T 
Our past work has also shown that DOD has not provided a clear and 

transparent basis for its military personnel requests to Congress that 

demonstrates how these requests are linked to the defense strategy. We

believe that it will become increasingly important to demonstrate a clear 

linkage as Congress confronts looming fiscal challenges facing the nation 

and DOD attempts to balance competing priorities for resources in 

personnel, operations, and investments accounts. DOD’s February QDR 

2006 report did not provide much insight into the basis for its conclusion 

that the size of today’s forces is appropriate to meet current and projected

operational demands. Further, the Marine Corps’ decision to initiate a new 

study to assess its active military requirements shortly after the QDR 

report was issued is an indication that the QDR did not achieve consensus 

on required military personnel levels. In evaluating DOD’s proposal to 

permanently increase active Army and Marine Corps personnel levels by 

92,000 over the next 5 years, Congress should carefully weigh the longterm costs and benefits. While the Army and Marine Corps are currently 

experiencing a high operating tempo, increasing personnel levels will 

entail billions of dollars for both start-up and recurring costs, not just for 

the personnel added to the force, but for related equipment and training. 

Given the significant implications of this request, DOD should be prepared 

to fully explain and document the basis for the proposed increases and 

how the additional positions will be used. To help illuminate the basis for 

DOD’s request, Congress may wish to consider requiring DOD to answer 

the following questions: What analysis has been done to demonstrate how 

the proposed increases are linked to the defense strategy? How will the 

additional personnel be allocated to combat units, support forces, and 

institutional personnel, for functions such as training and acquisition? 

What are the initial and long-term costs to increase the size of the force 

and how does DOD plan to fund this increase? Do the services have 

detailed implementation plans to manage potential challenges, such as 

recruiting additional personnel, providing facilities, and procuring new 

equipment? Our prior work on recruiting and retention challenges, along 

with our prior reports on challenges in equipping modular units, identify 

some potential challenges that could arise in implementing an increase in 

the size of the Army and Marine Corps at a time when the services are 

supporting ongoing operations in Iraq and Afghanistan. 

Background The 2005 National Defense Strategy provided the strategic foundation for

the 2006 QDR and identified an array of traditional, irregular, catastrophic, 

and disruptive challenges that threaten U.S. interests. To operationalize 

the defense strategy, the 2006 QDR identified four priority areas for further 

examination: defeating terrorist networks, defending the homeland, 

Page 4 GAO-07-397T 
shaping the choices of countries at strategic crossroads, and preventing 

hostile state and non-state actors from acquiring or using weapons of mass 

destruction. These areas illustrated the types of capabilities and forces 

needed to address the challenges identified in the defense strategy and 

helped DOD to assess that strategy and review its force planning 

construct. Changes in the security environment and the force planning 

construct may require DOD and the services to reassess force structure 

requirements—how many units and of what type are needed to carry out 

the national defense strategy. Likewise, changing force structure 

requirements may create a need to reassess active end strength—-the 

number of military personnel annually authorized by Congress which each 

service can have at the end of a given fiscal year.

The services allocate their congressionally authorized end strength among 

operational force requirements (e.g., combat and support force units), 

institutional requirements, and requirements for personnel who are 

temporarily unavailable for assignment. Operational forces are the forces 

the services provide to combatant commanders to meet mission 

requirements, such as ongoing operations in Iraq and Afghanistan. 

Institutional forces include command headquarters, doctrine writers, and 

a cadre of acquisition personnel, which are needed to prepare forces for 

combat operations. Personnel who are temporarily unavailable for 

assignment include transients, transfers, holdees, and students. 

The Secretary of Defense’s recent proposal to permanently increase the 

size of the Army and Marine Corps represents a significant shift in DOD’s 

plans, as reflected in the 2006 QDR. In fiscal year 2004, the Army’s 

authorized end strength was 482,400 active military personnel. Since that 

time, the Army has been granted authority to increase its end strength by 

30,000 in order to provide flexibility to implement its transformation to a 

modular force while continuing to deploy forces to overseas operations. 

Rather than return the Army to the 482,400 level by fiscal year 2011, as 

decided in the 2006 QDR, DOD’s new proposal would increase the Army’s 

permanent end strength level to 547,000 over a period of 5 years. DOD’s 

plans for Marine Corps end strength have also changed. In fiscal year 2004, 

the Marine Corps’ was authorized to have 175,000 active military 

personnel. For the current fiscal year, Marine Corps end strength was 

authorized at 180,000, although DOD’s 2006 QDR planned to stabilize the 

Marine Corps at the 175,000 level by fiscal year 2011. The Secretary’s new 

proposal would increase permanent Marine Corps end strength to a level 

of 202,000 over the next 5 years. In terms of funding, DOD is currently 

authorized to pay for end strength above 482,400 and 175,000 for the Army 

and Marine Corps, respectively, with emergency contingency reserve 

Page 5 GAO-07-397T 
funds or from supplemental funds used to finance operations in Iraq and

Afghanistan. Until Congress receives the President’s budget request, it is 

unclear how DOD plans to fund the proposed increases. 

In 2004, the Army began its modular force transformation to restructure 

itself from a division-based force to a modular brigade-based force—an 

undertaking it considers the most extensive reorganization of its force 

since World War II. This initiative, according to Army estimates, will 

require an investment exceeding $52 billion through fiscal year 2011. The 

foundation of the modular force is the creation of standardized modular 

combat brigades in both the active component and National Guard. The 

new modular brigades are designed to be self-sufficient units that are more 

rapidly deployable and better able to conduct joint and expeditionary 

operations than their larger division-based predecessors. The Army 

planned to achieve its modular restructuring without permanently 

increasing its active component end strength above 482,400, in accordance 

with a decision reached during the 2006 QDR. The February 2006 QDR 

also specified that the Army would create 70 active modular combat 

brigades in its active component and National Guard. 

According to the Army, the modular force will enable it to generate both 

active and reserve component forces in a rotational manner. To do this, 

the Army is developing plans for a force rotation model in which units will 

rotate through a structured progression of increased unit readiness over 

time. For example, the Army’s plan is for active service members to be at 

home for 2 years following each deployment of up to 1 year. 

Both OSD and the military services play key roles in determining force 

structure and military personnel requirements and rely on a number of 

complex and interrelated process and analyses-–rather than on one clearly 

documented process. Decisions made by OSD can have a ripple effect on

the analyses that are conducted at the service level, as I will explain later. 

OSD is responsible for the QDR–-the official strategic plan of DOD–-and 

provides policy and budget guidance to the services on the number of 

active personnel. The QDR determines the size of each services’ 

operational combat forces based on an analysis of the forces needed to 

meet the requirements of the National Defense Strategy. For example, the 

2006 QDR specified the Army’s operational force structure would include

42 active Brigade Combat Teams and that the Army should plan for an 

active force totaling 482,400 personnel by fiscal year 2011. The QDR also 

Determination of 

Force Structure and 

Military Personnel 

Requirements Is A 

Complex Process 

Involving Both OSD 

And The Services 

Page 6 GAO-07-397T 
directed the Marine Corps to add a Special Operations Command and plan

for an active force totaling 175,000 military personnel by fiscal year 2011.

In order to provide a military perspective on the decisions reached in the 

QDR, Congress required the Chairman of the Joint Chiefs of Staff to 

conduct an assessment of the review including an assessment of risk. In 

his assessment of the 2006 QDR, the Chairman concluded that the Armed 

Forces of the United States stood “fully capable of accomplishing all the 

objectives of the National Defense Strategy.” In his risk assessment, he 

noted that the review had carefully balanced those areas where risk might 

best be taken in order to provide the needed resources for areas requiring 

new or additional investment. 

Another area where the Office of the Secretary of Defense plays an 

important role is in developing various planning scenarios that describe 

the type of missions the services may face in the future. These scenarios 

are included in planning guidance that the Office of the Secretary of 

Defense provides the services to assist them in making more specific 

decisions on how to allocate their resources to accomplish the national

defense strategy. For example, these scenarios would include major 

combat operations, stability operations, domestic support operations, and 

humanitarian assistance operations. 

GAO examined whether DOD had established a solid foundation for 

determining military personnel requirements. While we are currently 

reviewing the plans and analyses of the 2006 QDR, our February 2005 

assessment of DOD’s processes identified several concerns that, if left 

uncorrected, could have hampered DOD’s QDR analysis.1

 First, we found 

that DOD had not conducted a comprehensive, data-driven analysis to 

assess the number of active personnel needed to implement the defense 

strategy. Second, OSD does not specifically review the services’ 

requirements processes to ensure that decisions about personnel levels 

are linked to the defense strategy. Last, a key reason why OSD had not 

conducted a comprehensive analysis was that it has sought to limit 

personnel costs to fund competing priorities such as transformation. 

 1

 GAO, Military Personnel: DOD Needs to Conduct a Data-Driven Analysis of Active 

Military Personnel Levels Required to Implement the Defense Strategy, GAO-05-200 

(Washington, D.C.: Feb. 1, 2005). 

Page 7 GAO-07-397T 
The Army uses a biennial, scenario-based requirements process to 

estimate the number and types of operational and institutional forces 

needed to execute Army missions. This process involves first determining 

the number and type of forces needed to execute the National Military 

Strategy based on OSD guidance, comparing this requirement with the 

Army’s present force structure, and finally reallocating military positions 

to minimize the risks associated with any identified shortfalls. Taken 

together, this process is known as “Total Army Analysis.” The Army has 

conducted this analysis for many years and has a good track record for 

updating and improving its modeling, assumptions, and related processes 

over time, as we noted in our last detailed analysis of the Army’s process.2

Active and reserve forces are included in this analysis in order to provide a 

total look at Army requirements and the total end strength available to

resource those requirements. Also, the number of combat brigades is 

specified by OSD in the QDR and is essentially a “given” in the Army’s 

requirements process. The Army’s process is primarily intended to assess 

the support force structure needed to meet the requirements of the 

planning scenarios, and to provide senior leadership a basis for better 

balancing the force. 

The Army Has a Biennial 

Process to Assess Force 

Structure and Allocate 

Military Personnel 

Positions to Units 

In the first phase of the Army’s requirements determination process, the 

Army uses several models, such as a model to simulate warfights using the 

scenarios provided by OSD and the number of brigades OSD plans to use 

in each scenario. The outcomes of the warfighting analyses are used in 

further modeling to generate the number and specific types of units the 

Army would need to support its brigade combat teams. For example, for a 

prolonged major war, the Army needs more truck companies to deliver 

supplies and fuel to front line units. For other types of contingencies, the 

Army may use historical experience for similar operations to determine 

requirements since models are not available for all contingencies. The 

Army also examines requirements for the Army’s institutional force, such 

as the Army’s training base, in order to obtain a total bottom line 

requirement for all the Army’s missions. 

In the second phase of the Army’s process—known as the “resourcing 

phase”— the Army makes decisions on how to best allocate the active and 

reserve military personnel levels established by OSD against these 

requirements. In order to provide the best match, the Army will develop a 

 2

 GAO, Force Structure: Projected Requirements for Some Army Forces Not Well

Established, GAO-01-485 (Washington, D.C.: May 11, 2001).

Page 8 GAO-07-397T 
detailed plan to eliminate lower priority units, and stand up new units it 

believes are essential to address capability gaps and meet future mission 

needs. For example, in recent years, the Army has made an effort to 

increase units needed for military police, civil affairs, engineers, and 

special operations forces. These decisions are implemented over the 

multiple years contained in DOD’s Future Years Defense Program. For 

example, the intent of the Army’s most recent analysis was used to help

develop the Army’s budget plans for fiscal years 2008–2013. 

Historically, the Army has had some mismatches between the

requirements it estimated and its available military personnel levels. When

shortfalls exist, the Army has chosen to fully resource its active combat 

brigades and accept risk among it support units, many of which are in the 

reserve component. 

The Marine Corps uses a number of modeling, simulations, spreadsheet 

analyses, and other analytical tools to periodically identify gaps in its 

capabilities to perform its missions, and identify the personnel and skills 

needed to provide the capabilities based largely on the professional 

judgment of manpower experts and subject-matter experts. The results are 

summarized in a manpower document, updated as needed, which is used 

to allocate positions and personnel to meet mission priorities. This 

document is an assessment of what core capabilities can and cannot be

supported within the authorized end strength, which may fall short of the 

needed actual personnel requirements. For example, in 2005, we reported 

that the Marine Corps analysis for fiscal year 2004 indicated that to 

execute its assigned missions, the Corps would need about 9,600 more 

personnel than it had on hand. At the time of this analysis, OSD fiscal 

guidance directed the Marine Corps to plan for an end strength of 175,000

in the service’s budget submission. 

Both the Army and Marine Corps are coping with additional demands that 

may not have been fully reflected in the QDR or their own service 

requirements analyses, which have been based on OSD guidance. While 

the Army’s most recent analysis, completed in 2006, concluded that Army 

requirements were about equal to available forces for all three 

components, this analysis did not fully reflect the effects of establishing 

modular brigades-–the most significant restructuring of the Army’s 

operational force structure since World War II. In addition, OSD-directed 

planning scenarios used by the Army in its analysis to help assess 

rotational demands on the force may not have reflected real-world 

The Marine Corps 

Conducts a Variety of 

Analyses to Assess Force 

Structure and Military 

Personnel Requirements 

New Demands on 

Services Have Not 

Been Fully Reflected 

In Recent 

Requirements 

Analyses 

Page 9 GAO-07-397T 
conditions such as those in Iraq and Afghanistan. While the requirements 

phase of the Army’s analysis, completed in the mid-2005 time frame, may 

have been based on the best information available at the time, the Army’s 

transformation concepts have continued to evolve and the mismatch 

between the planning scenarios and actual operations are now more 

apparent. The Marine Corps is also undergoing a high pace of operations, 

as well as QDR-directed changes in force structure. This has caused the 

Marine Corps to initiate a new post-QDR analysis of its force structure 

requirements. 

The service analyses I am about to discuss all preceded the Secretary of 

Defense’s announcement of his intention to increase Army and Marine 

Corps end strength by 92,000. However, some of GAO’s reporting on these 

plans is only months old and should provide a baseline to help the 

committee understand what has changed since the 2006 QDR and service 

analyses were completed. 

Army’s Most Recent 

Biennial Analysis Did Not 

Fully Consider 

Requirements for Modular 

Units and Force Rotation 

Demands 

The Army’s most recent requirements analysis, which examined force 

structure and military personnel needs for fiscal years 2008 through 2013, 

considered some of the Army’s new transformation concepts, such as the 

Army’s conversion to a modular force. However, the Army did not 

consider the full impact of this transformation in its analysis, in part 

because these initiatives were relatively new at the time the analysis was 

conducted. The Army’s recent analysis recognized that modular units 

would require greater numbers of combat forces than its prior divisionbased force and assumed this could be accomplished by reducing military 

positions in the Army’s institutional forces, such as its command 

headquarters and training base, rather than increasing the size of the 

active force. However, in our September 2006 report discussing the Army’s 

progress in converting to a modular force, we questioned whether the 

Army could meet all of its modular force requirements with a QDRdirected, active component end strength of 482,400.3

 Under its new 

modular force, the Army will have 42 active brigades compared with 33 

brigades in its division-based force. In total, these brigades will require 

more military personnel than the Army’s prior division-based combat 

units. Therefore, as figure 1 illustrates, the Army planned to increase its 

 3

 GAO, Force Structure: Army Needs to Provide DOD and Congress More Visibility 

Regarding Modular Force Capabilities and Implementation Plans, GAO-06-745 

(Washington, D.C.: Sept. 6, 2006). 

Page 10 GAO-07-397T 
active component operational force—that is, its combat forces—from 

315,000 to 355,000 personnel to fully staff 42 active modular brigade 

combat teams. To accomplish this with an active end strength level of 

482,400, the Army had hoped to substantially reduce the size of its active 

component institutional force—that is, its training base, acquisition 

workforce, and major command headquarters—from 102,000 to 75,000 

military personnel. The Army also planned to reduce the number of active 

Army personnel in a temporary status at any given time, known as 

transients, transfers, holdees, and students, or TTHS. In fiscal year 2000, 

this portion of the force consisted of 63,000 active military personnel and 

the Army planned to reduce its size to 52,400. 

Figure 1: A Comparison of Active Army End Strength Allocations before and after the Modular Force Conversion 

Before modular conversion—fiscal year 2000 After modular conversion—fiscal year 2013 

While the Army has several initiatives under way to reduce active military 

personnel in its institutional force, our report questioned whether those 

initiatives could be fully achieved as planned. The Army had made some 

progress in converting some military positions to civilian positions, but 

Army officials believed additional conversions to achieve planned 

reductions in the noncombat force would be significantly more 

challenging to achieve and could lead to difficult trade-offs. In addition, 

cutting the institutional force at a time when the Army is fully engaged in

training forces for overseas operations may entail additional risk not fully 

Page 11 GAO-07-397T 
anticipated at the time the initiatives were proposed. Last, we noted that 

the Army is still assessing its modular unit concepts based on lessons 

learned from operations in Iraq and Afghanistan and other analyses led by 

the Army’s Training and Doctrine Command, and the impact on force 

structure requirements may not yet be fully known. 

We should note that, at the time of our report, the Army did not agree with 

our assessment of its personnel initiatives. In written comments on a draft 

of our report, the Army disagreed with our analysis of the challenges it 

faced in implementing its initiatives to increase the size of the operational 

force within existing end strength, noting that GAO focused inappropriate 

attention on these challenges. The Army only partially concurred with our 

recommendation that the Secretary of the Army develop and provide the 

Secretary of Defense and Congress with a report on the status of its 

personnel initiatives, including executable milestones for realigning and 

reducing its noncombat forces. The Army stated that this action was 

already occurring on a regular basis and another report on this issue 

would be duplicative and irrelevant. However, the reports the Army cited 

in its response were internal to the Army and the Office of the Secretary of

Defense. The comments did not address the oversight needs of Congress. 

We stated in our report that we believe that it is important for the 

Secretary of Defense and Congress to have a clear and transparent picture 

of the personnel challenges the Army faces in order to fully achieve the 

goals of modular restructuring and make informed decisions on resources 

and authorized end strength. 

Another factor to consider is that the Army’s most recent requirements 

analysis was linked to planning scenarios directed by OSD and did not 

fully reflect current operational demands for Iraq and Afghanistan. The 

Army’s analysis assumed that the Army would be able to provide 18 to 19

brigades at any one time (including 14 active and 4 to 5 National Guard 

brigades) to support worldwide operations. However, the Army’s global 

operational demand for forces is currently 23 brigades and Army officials 

believe this demand will continue for the foreseeable future. 

The Marine Corps is also experiencing new missions and demands as a 

result of the Global War on Terrorism. However, these new requirements 

do not appear to have been fully addressed in its requirements analyses.

The following is a summary of the principal analyses that were undertaken 

to address Marine Corps force structure personnel requirements in the 

past few years. 

The Marine Corps Is Also 

Facing New Demands That 

May Not Have Been Fully 

Reflected in Recent 

Requirements Analyses 

Page 12 GAO-07-397T 
• In 2004, the Marine Corps established a Force Structure Review Group to 

evaluate what changes in active and reserve capabilities needed to be 

created, reduced, or deactivated in light of personnel tempo trends and the 

types of units in high demand since the Global War on Terrorism. As a 

result of this review, the Marine Corps approved a number of force 

structure changes including increases in the active component’s infantry, 

reconnaissance, and gunfire capabilities and decreases in the active 

component’s small-craft company and low-altitude air defense positions. 

However, this review was based on the assumption that the Marine Corps 

would need to plan for an end strength of 175,000 active personnel. As a 

result, the Marine Corps’ 2004 review focused mostly on rebalancing the

core capabilities of the active and reserve component rather than a 

bottom-up review of total personnel requirements to meet all 21st century

challenges. 

• In March 2006, shortly after the QDR was issued, the Marine Corps 

Commandant formed a Capabilities Assessment Group to assess 

requirements for active Marine Corps military personnel. One of the 

group’s key tasks was to determine how and whether the Marine Corps 

could meet its ongoing requirements while supporting the QDR decision to

establish a 2,600 personnel Marine Corps Special Operations Command. 

The group was also charged with identifying what core capabilities could 

be provided at a higher end strength level of 180,000. We received some 

initial briefings on the scope of the group’s work. Moreover, Marine Corps 

officials told us that the group completed its analysis in June 2006. 

However, as of September 2006 when we completed our work, the Marine 

Corps had not released the results of its analysis. Therefore, it is not clear 

whether and to what extent this review formed the basis for the 

President’s recent announcement to permanently expand the size of the 

active Marine Corps. 

Our past work has also shown that DOD has not provided a clear and 

transparent basis for its military personnel requests to Congress, requests 

that demonstrate a clear link to military strategy. Ensuring that the 

department provides a sound basis for military personnel requests and can 

demonstrate how they are linked to the military strategy will become 

increasingly important as Congress confronts looming fiscal challenges 

facing the nation. During the next decade, Congress will be faced with 

making difficult trade-offs among defense and nondefense-related 

spending. Within the defense budget, it will need to allocate resources 

among the services and their respective personnel, operations, and 

investment accounts while faced with multiple competing priorities for 

funds. DOD will need to ensure that each service manages personnel levels 

efficiently since personnel costs have been rising significantly over the

DOD Has Not Clearly 

Demonstrated the 

Basis For Military 

Personnel Requests 

Page 13 GAO-07-397T 
past decade. We have previously reported that the average cost of 

compensation (including cash, non-cash, and deferred benefits) for 

enlisted members and officers was about $112,000 in fiscal year 2004.4

 The 

growth in military personnel costs has been fueled in part by increases in 

basic pay, housing allowances, recruitment and retention bonuses, 

incentive pay and allowances, and other special pay. Furthermore, DOD’s 

costs to provide benefits, such as health care, have continued to spiral 

upward. 

As noted earlier, we have found that valid and reliable data about the 

number of personnel required to meet an agency’s needs are critical 

because human capital shortfalls can threaten an agency’s ability to 

perform its missions efficiently and effectively. Data-driven 

decisionmaking is one of the critical factors in successful strategic 

workforce management. High-performing organizations routinely use 

current, valid, and reliable data to inform decisions about current and 

future workforce needs. In addition, they stay alert to emerging mission 

demands and remain open to reevaluating their human capital practices. In 

addition, federal agencies have a responsibility to provide sufficient 

transparency over significant decisions affecting requirements for federal 

dollars so that Congress can effectively evaluate the benefits, costs, and 

risks. 

DOD’s record in providing a transparent basis for requested military 

personnel levels can be improved. We previously reported that DOD’s 

annual report to Congress on manpower requirements for fiscal year 2005 

broadly stated a justification for DOD’s requested active military 

personnel, but did not provide specific analyses to support the 

justification. In addition, DOD’s 2006 QDR report did not provide 

significant insight into the basis for its conclusion that the size of today’s 

forces—both the active and reserve components across all four military 

services—is appropriate to meet current and projected operational 

demands. Moreover, the Marine Corps’ decision to initiate a new study to 

assess active military personnel requirements shortly after the 2006 QDR 

was completed is an indication that the QDR did not achieve consensus in 

required end strength levels. 

 4

 GAO, Military Personnel: DOD Needs to Improve the Transparency and Reassess the 

Reasonableness, Appropriateness, Affordability, and Sustainability of its Military

Compensation System, GAO-05-798 (Washington, D.C.: July 19, 2005). 

Page 14 GAO-07-397T 
In evaluating DOD’s proposal to permanently increase active Army and 

Marine Corps personnel levels by 92,000 over the next 5 years, Congress 

should carefully weigh the long-term costs and benefits. It is clear that 

Army and Marine Corps forces are experiencing a high pace of operations 

due to both the war in Iraq and broader demands imposed by the Global 

War on Terrorism that may provide a basis for DOD to consider permanent 

increases in military personnel levels. However, it is also clear that 

increasing personnel levels will entail significant costs that must be 

weighed against other priorities. The Army has previously stated that it 

costs about $1.2 billion per year to increase active military personnel 

levels by 10,000. Moreover, equipping and training new units will require 

billions of additional dollars for startup and recurring costs. 

DOD has not yet provided a detailed analysis to support its proposal to 

permanently increase the size of the Army and Marine Corps. Given the 

significant implications for the nation’s ability to carry out its defense 

strategy along with the significant costs involved, additional information 

will be needed to fully evaluate the Secretary of Defense’s proposal. 

To help illuminate the basis for its request, DOD will need to provide 

answers to the following questions: 

• What analysis has been done to demonstrate how the proposed increases 

are linked to the defense strategy? To what extent are the proposed 

military personnel increases based on supporting operations in Iraq versus 

an assessment of longer-term requirements? 

• How will the additional personnel be allocated to combat units, support 

forces, and institutional personnel, for functions such as training and 

acquisition?

• What are the initial and long-term costs to increase the size of the force 

and how does the department plan to fund this increase? 

• Do the services have detailed implementation plans to manage potential 

challenges such as recruiting additional personnel, providing facilities, and 

procuring new equipment? 

Our prior work on recruiting and retention challenges, along with our 

prior reports on challenges in equipping modular units, identify some 

potential challenges that could arise in implementing an increase in the 

size of the Army and Marine Corps at a time when the services are 

supporting ongoing operations in Iraq and Afghanistan. For example, we 

have reported that 19 percent of DOD’s occupational specialties for 

enlisted personnel were consistently overfilled while other occupational 

specialties were underfilled by 41 percent for fiscal years 2000 through 

Page 15 GAO-07-397T 
2005.

5

 In addition, we have reported that the Army is experiencing 

numerous challenges in equipping modular brigades on schedule, in part 

due to the demands associated with meeting the equipment needs of units 

deploying overseas.6

 Such challenges will need to be carefully managed if 

Congress approves the Secretary of Defense’s proposal. 

Mr. Chairman and members of the subcommittee, this concludes my 

prepared remarks. I would be happy to answer any questions you may 

have. 

For questions about this statement, please contact Janet St. Laurent at 

(202) 512-4402. Other individuals making key contributions to this 

statement include: Gwendolyn Jaffe, Assistant Director; Kelly

Baumgartner; J. Andrew Walker; Margaret Morgan; Deborah Colantonio; 

Harold Reich; Aisha Cabrer; Susan Ditto; Julie Matta; and Terry 

Richardson. 

Contacts and 

Acknowledgments 

 5

 GAO, Military Personnel: DOD Needs Action Plan to Address Enlisted Personnel 

Recruitment and Retention Challenges, GAO-06-134 (Washington, D.C.: Nov. 17, 2005). 

6 GAO-06-745. 

Page 16 GAO-07-397T 
Page 17 GAO-07-397T 

Related GAO Products 

Force Structure: Army Support Forces Can Meet Two-Conflict Strategy 

With Some Risks. GAO/NSIAD-97-66. Washington, D.C.: Feb. 28, 1997. 

Force Structure: Army’s Efforts to Improve Efficiency of Institutional 

Forces Have Produced Few Results. GAO/NSIAD-98-65. Washington, D.C.:

Feb. 26, 1998. 

Force Structure: Opportunities Exist for the Army to Reduce Risk in 

Executing the Military Strategy. GAO/NSIAD-99-47. Washington, D.C.: 

Mar. 15, 1999. 

Force Structure: Army is Integrating Active and Reserve Combat Forces, 

but Challenges Remain. GAO/NSIAD-00-162. Washington, D.C.: July 18,

2000. 

Force Structure: Army Lacks Units Needed for Extended Contingency 

Operations. GAO-01-198. Washington, D.C.: Feb. 15, 2001. 

Force Structure: Projected Requirements for Some Army Forces Not Well 

Established. GAO-01-485. Washington, D.C.: May 11, 2001. 

Military Personnel: DOD Needs to Conduct a Data-Driven Analysis of 

Active Military Personnel Levels Required to Implement the Defense 

Strategy. GAO-05-200. Washington, D.C.: Feb. 1, 2005. 

Force Structure: Preliminary Observations on Army Plans to Implement 

and Fund Modular Forces. GAO-05-443T. Washington, D.C.: Mar. 16, 2005. 

Force Structure: Actions Needed to Improve Estimates and Oversight of 

Costs for Transforming Army to a Modular Force. GAO-05-926. 

Washington, D.C.: Sep. 29, 2005. 

Force Structure: Capabilities and Cost of Army Modular Force Remain 

Uncertain. GAO-06-548T. Washington, D.C.: Apr. 4, 2006. 

Force Structure: DOD Needs to Integrate Data into Its Force 

Identification Process and Examine Options to Meet Requirements for 

High-Demand Support Forces. GAO-06-962. Washington, D.C.: Sep. 5, 

2006. 

Force Structure: Army Needs to Provide DOD and Congress More 

Visibility Regarding Modular Force Capabilities and Implementation 

Plans. GAO-06-745. Washington, D.C.: Sep. 6, 2006. 

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