Development of a forecasting model of Naval aviator retention rates

Abstract

The objective of this thesis is to develop an estimating model to predict the effects of various internal and external variables on Naval aviator retention rates. The estimating model will be useful to aviation program managers to develop a spreadsheet tool for predicting retention rates for Naval aviators. Past analyses have focused mainly on analyzing micro-level data. This thesis uses grouped retention rates for all Naval aviators for fiscal years 1977 through 1993 to determine factors associated with the retention decisions made by specific cohorts. The analysis quantifies the relationships between retention and various internal, external and time-related factors. Among the internal factors are various downsizing policies such as the Voluntary Separation Incentive/ Selective Separation Bonus (VSI/SSB) program and rightsizing tools such as the Aviation Continuation Pay (ACP) program. External factors examined include both civilian unemployment rates and major airline hiring rates. Additionally, time since minimum service requirement (MSR) was included in the models to control for the effects on aviator continuation rates of the expiration of the MSR during the 6-11 year mark of an aviator's career. Models were specified for each of the naval aviation communities including jet, propeller, and helicopter, and estimated using a grouped LOGlT estimation technique. The study finds that civilian unemployment rates, VSI/SSB, ACP and airline hiring rates have significant effects on retention in the various aviation communities.