Analysis of civilian labor costs within the Department of the Navy

Abstract

Civilian labor costs rose 2.2 percent in the 12-month period ending in December 2016, according to a January 2017 Bureau of Labor Statistics cost index. Changes in labor costs can affect the financial stability of not only private corporations but also government organizations, such as the Department of the Navy (DoN). Both private and public employers must compete in the same market for skilled professionals. Understanding how civilian labor costs change is of particular importance to the DoN, considering that the service is a manpower-intensive organization limited by congressionally enacted restraints that affect the service's budgets. By conducting a statistical analysis of recent historical data, creating basic models, and projecting those models for the near future, this report provides a macro-level overview of the Navy's civilian labor costs so that Navy leadership can make better-informed decisions on the expenditure of limited funds.