ORB Impact on Officer Retention in the Navy Explosive Ordnance Disposal (EOD) Community

Abstract

The Navy Explosive Ordnance Disposal (NEOD) community continues to struggle to retain officers at eight to ten years of commissioned service (YCS). In an effort to incentivize more officers to stay, the Navy implemented an officer retention bonus (ORB) in 2005. Since its inception, the bonus has had a statistically significant increase in retention but has diminished in its attractiveness over time, as fewer and fewer officers take the bonus each year. The object of this project is to study the effectiveness of monetary incentives, specifically the ORB, and its ability to influence the retention decisions of Navy EOD officers at critical career points. Using demographic data from the Officer Personnel Information System (OPINS) from various Navy EOD year groups, a logistic regression analysis was run to quantify the relationship between ORB amounts and "take" decisions. Based on the regression results, ORB amounts were shown to be statistically significant at the 95 percent confidence level. These findings were then used to develop a logit model. Using this model, it was shown that in order to return to the targeted 75 percent "take" rate, the ORB amount would need to be increased and adjusted for inflation. Therefore, it is recommended that the ORB be updated, at a minimum, on a periodic basis to keep pace with inflation, if it is to remain competitive with earnings potential outside of the Navy.