Since the end of the Cold War, there has been a shift in the way reserve forces have been used. Previously, reservists were viewed primarily as an expansion force that would supplement active forces during a major war. Today, reservists not only supplement but also replace active forces in military operations worldwide. In fact, DOD has stated that no significant operation can be conducted without reserve involvement. As shown in figure 1, reserve participation in military operations spiked in fiscal years 1991 (Desert Shield and Desert Storm) and 2002 (Noble Eagle and Enduring Freedom). There have been wide differences in the operational tempos of individual reservists in certain units and occupations. Prior to the current mobilization, personnel in the fields of aviation, special forces, security, intelligence, psychological operations, and civil affairs were in high demand, experiencing operational tempos that were two to seven times higher than those of the average reservist. Since September 2001, operational tempos have increased significantly for reservists in all of DOD’s reserve components due to the partial mobilization in effect to support operations Noble Eagle and Enduring Freedom. For each year between fiscal years 1997 and 2002, the reserves on the whole achieved at least 99 percent of their authorized end strength. In 4 of these 6 years, they met at least 100 percent of their enlistment goals. During this time period, enlistment rates fluctuated from component to component. Overall attrition rates have decreased for five of DOD’s six reserve components. Between fiscal years 1997 and 2002, only the Army National Guard experienced a slight overall increase in attrition. The attrition data suggest there has not been a consistent relationship between a component’s average attrition rate for a given year and the attrition rate for that component’s high demand capabilities (which include units and occupations). Attrition rates for high demand capabilities were higher than average in some cases but lower for others. Aviation in the Army National Guard, for instance, has had higher than average attrition for 4 of the 5 years it was categorized as a high demand capability. Preliminary analysis of income changes reported by reservists who mobilized or deployed for past military operations indicates that they experienced widely varying degrees of income loss or gain. The source for this analysis is DOD’s 2000 Survey of Reserve Component Personnel, which predates the mobilization that began in September 2001. The data show that 41 percent of drilling unit members reported income loss during their most recent mobilization or deployment, while 30 percent reported no change and 29 percent reported an increase in income (see table 1). Based on the survey data, DOD estimated that the average total income change for all members (including losses and gains) was almost $1,700 in losses. This figure should be considered with caution because of the estimating methodology that was used and because it is unclear what survey respondents considered as income loss or gain in answering this question. Further, reservists are mobilized or deployed for varying lengths of time, which can affect their overall income loss or gain. About 31 percent of all reservists who had at least one mobilization or deployment had been mobilized or deployed for less than 1 month. For the entire population, members spent an estimated 3.6 months mobilized or deployed for their most recent mobilization. DOD’s preliminary analysis of the survey data show that certain groups reported greater losses of income on average. Self-employed reservists reported an average income loss of $6,500. Physicians/registered nurses, on the whole, reported an average income loss of $9,000. Physicians/registered nurses in private practice reported an average income loss of $25,600. Income loss also varied by reserve component and pay grade group. Average self-reported income loss ranged from $600 for members of the Air National Guard up to $3,800 for Marine Corps Reservists. Senior officers reported an average income loss of $5,000 compared with $700 for junior enlisted members. When asked to rank income loss among other problems they have experienced during mobilization or deployment, about half of drilling unit members ranked it as one of their most serious problems. DOD’s preliminary analysis presents little data on those groups who reported overall income gain. Two groups who were identified as reporting a gain were clergy and those who worked for a family business without pay. Concerns were raised following the 1991 Gulf War that income loss would adversely affect retention of reservists. According to a 1991 DOD survey of reservists activated during the Gulf War, economic loss was widespread across all pay grades and military occupations. In response to congressional direction, DOD in 1996 established the Ready Reserve Mobilization Income Insurance Program, an optional, self-funded income insurance program for members of the Ready Reserve ordered involuntarily to active duty for more than 30 days. Reservists who elected to enroll could obtain monthly coverage ranging from $500 to $5,000 for up to 12 months within an 18-month period. Far fewer reservists than DOD expected enrolled in the program. Many of those who enrolled were activated for duty in Bosnia and, thus, entitled to almost immediate benefits from the program. The program was terminated in 1997 after going bankrupt. We reported in 1997 that private sector insurers were not interested in underwriting a reserve income mobilization insurance program due to concerns about actuarial soundness and unpredictability of the frequency, duration, and size of future call-ups. Certain coverage features would violate many of the principles that private sector insurers usually require to protect themselves from adverse selection. These include voluntary coverage and full self-funding by those insured, the absence of rates that differentiated between participants based on their likelihood of mobilization, the ability to choose coverage that could result in full replacement of their lost income rather than those insured bearing some loss, and the ability to obtain immediate coverage shortly before an insured event occurred. According to DOD officials, private sector insurers remain unsupportive of a new reserve income insurance mobilization program and the amount of federal underwriting required for the program is prohibitive. The Department has no plans to implement a new mobilization insurance program. A 1998 study by RAND found that income loss, while widespread during the Gulf War, did not have a measurable effect on enlisted retention. The study was cautiously optimistic that mobilizing the reserves under similar circumstances in the future would not have adverse effects on recruiting and retention. However, the effects of future mobilizations can depend on the mission, the length of time reservists are deployed, the degree of support from employers and family members, and other factors. Certain federal protections, pay policies, and employer practices can help to alleviate financial hardship during deployment. For example, the Soldiers’ and Sailors’ Civil Relief Act caps debt interest rates at 6 percent annually. Income that servicemembers earn while mobilized in certain combat zones is tax-free. For certain operations, DOD also authorized reservists to receive both full housing allowances and per diem for their entire period of activation. In addition, some employers make up the difference between civilian and military pay for their mobilized employees. This practice varies considerably among employers. Servicemembers can also obtain emergency assistance in the form of interest-free loans or grants from service aid societies to pay for basic living expenses such as food or rent during activation. DOD is exploring debt management alternatives, such as debt restructuring and deferment of principle and interest payments, as ways to address income loss. The Army has proposed a new special pay targeting critical health care professionals in the reserves who are in private practice and are deployed involuntarily beyond the established rotational schedule. Reservists who have been activated for previous contingency operations have expressed concerns about the additional burdens placed on their families while they are gone. More than half of all reservists are married and about half have children or other legal dependents. According to the 2000 survey, among the most serious problems reservists said they experienced when mobilized or deployed are the burden placed on their spouse and problems created for their children. The 1991 Gulf War was a milestone event that highlighted the importance of reserve family readiness. Lessons learned showed that families of activated reservists, like their active duty counterparts, may need assistance preparing wills, obtaining power of attorney, establishing emergency funds, and making child care arrangements. They may also need information on benefits and entitlements, military support services, and information on their reemployment rights. DOD has recognized that family attitudes affect reserve member readiness, satisfaction with reserve participation, and retention. Military members who are preoccupied with family issues during deployments may not perform well on the job, which in turn, negatively affects the mission. Research has shown that families of reservists who use family support services and who are provided information from the military cope better during activations. Under a 1994 DOD policy, the military services must “ensure National Guard and Reserve members and their families are prepared and adequately served by their services’ family care systems and organizations for the contingencies and stresses incident to military service.” Although activated reservists and their family members are eligible for the same family support services as their active duty counterparts, they may lack knowledge about or access to certain services. The 2000 DOD survey suggests that more than half of all reservists either believe that family support services are not available to them or do not know whether such services are available. Table 2 shows drilling unit members’ responses on the availability of selected programs and services. According to DOD officials, operations Noble Eagle and Enduring Freedom have highlighted the fact that not all reserve families are prepared for potential mobilization and deployment. They told us that since many families never thought their military members would be mobilized, families had not become involved in their family readiness networks. DOD has found that the degree to which reservists are aware of family support programs and benefits varies according to component, unit programs, command emphasis, reserve status, and the willingness of the individual member to receive or seek out information.