Activation and the Earnings of Reservists

David S. Loughran · Jacob Alex Klerman · Craig W. Martin

yan 2006 · Rand Corporation

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This document reports statistical estimates of the earnings of reservists. The document was produced as part of the RAND Corporation project entitled "The Effect of Activation on the Earnings of Reservists." That project matches administrative data on activations and military compensations from the Department of Defense to data on civilian earnings from the Social Security Administration to estimate the effect of activation on the earnings of reservists during and after the period they serve on active duty. Understanding the effect of activation on the earnings of reservists is crucial for designing an efficient and equitable compensation system for the reserve components. The estimates reported in this document improve on estimates reported in Early Results on Activations and the Earnings of Reservists by Klerman, Loughran, and Martin (RAND TR-274-OSD, 2005). That earlier study used a preexisting and selected sample and was limited to an analysis of civilian earnings data for 2001 only and military earnings for 2001-2003. This study uses a sample that was selected specifically for this study and includes civilian earnings data through 2003 and military earnings through 2004. In addition, this study makes numerous methodological improvements over the earlier study and reports more detailed results.