Air Force Pilot Bonus Program Reflects Institutional Panic

When Mark Welsh took over as Chief of Staff, pilots were hopeful for a new beginning with a true operational leader at the controls. As this year's pilot bonus demonstrates, Welsh's Air Staff has fared no better than predecessors in recognizing and precluding a clearly imminent drain of operational talent.
When Mark Welsh took over as Chief of Staff, pilots were hopeful for a new beginning with a true operational leader at the controls. As this year’s pilot bonus demonstrates, Welsh’s Air Staff has fared no better than predecessors in recognizing or lead-turning a clearly imminent drain of operational talent.


Gen. Mark Welsh says he doesn’t read blogs. Maybe he should start.

Had Welsh opened himself to the awareness harvestable via social media, he might have picked up on something that’s been energetically discussed on airman-centric social media outlets for the past two years: the likelihood of an imminent hemorrhage of aeronautical talent and experience from the Air Force. A drain based not on economics, but on quality of life and organizational conditions.

Last year, the Air Force rolled out a beefed up version of its annual Aviation Retention Pay (ARP) program, offering pilots upwards of $225,000 in bonus money to stay in the service for up to an additional nine years.

The result should have been a “Master Caution” for senior officials. Just 53% of eligible pilots took the money, the lowest rate in twelve years and a 15% nosedive from the year before. Nearly half of those eligible to receive extra money­ to continue doing what many consider the best job in the best Air Force in the world turned down that opportunity.

At the same time, approaching changes to federal aviation employment rules and a surging airline recovery were seen clearly converging to create new competition for experienced pilots.

But these trend lines did not ignite concerns about pilot retention or discussions about whether officials had gone too far in scaling back the ranks. Instead, generals at service headquarters insisted that they had pilot manning right where they wanted it. Others in the Air Force aviation community questioned this perspective, characterizing it as incomplete at best and broken from reality at worst.

It's a myth that ostriches bury their heads in the sand. The myth does not extend to Air Force generals when it comes the reasons for an approaching pilot manning crisis.
It’s a myth that ostriches bury their heads in the sand. The myth does not extend to Air Force generals when it comes to the reasons for an approaching pilot manning crisis.

Now, on the heels of Welsh’s controversial admonition to pilots at Creech Air Force Base that they shouldn’t expect any improvement in basic working conditions or quality of life, the service has released its 2015 ARP program.

While leaving unchanged the annual payout of $25,000, the Air Force’s 2015 program offers the bonus to more pilots and on longer contract terms than before, and has dramatically expanded the range of those eligible to receive a lump-sum up-front payout equivalent to half the total contract value. It also entices pilots to commit up to a year in advance of eligibility, allows prior contracts to be amended to add more years, and awards some pilots special cash in exchange for a commitment to cross-train into the Remotely Piloted Aircraft (RPA) community. It’s a huge program with a price tag estimated between fifty and a hundred million dollars, depending on the rate of participation.

The official Public Affairs guidance accompanying the program attributes the drastic changes to posturing “against an improving economy” and denies any “dramatic year-to-year shift in pilot behavior.” But the sense of desperation is as clear as the air of denial. While airline hiring is indeed newly brisk, this shouldn’t be a surprise. It doesn’t explain the inability of the service to retain enough pilots to operate the smallest fleet in its history, something that should ease rather than exacerbate pilot manning challenges. When supplemental compensation programs explode against descending personnel budgets, the hand of panic is usually what pulled the pin. When official guidance is riddled with such inconsistencies, it’s usually because whoever is in charge has lost the plot.

The 2015 version of ARP can be seen at once as a signal of panic and a fundamental misapprehension of how to solve the tacitly acknowledged crisis of talent loss in a career field at the strategic core of its duty to national defense. It can also be heard as a warning bell. If the Air Force doesn’t get its act together in such core matters as this, it will not be capable of doing what is expected in the future. The power of propaganda will prevent recognition of this deficiency until it’s too late for a remedy, embedding uncounted risk in the national defense portfolio.

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The Air Force doesn’t negotiate with its employees. Instead, it speaks to them through policy.

Taken together with Welsh’s recent rhetoric at Creech, this year’s bonus program sends pilots the indignant message that working conditions will not be addressed, and that the service will instead try to buy its way to mission capability. It seeks not necessarily to retain the best, most innovative, or most leadership-oriented of its aviators. It simply wants to retain a high enough number of those willing to accept whatever working conditions the institution chooses to impose.

This is a dubious approach for a program that purports to retain aviators not purely so they can operate aircraft, but so they can fulfill staff and leadership roles.

This sounds a little like mercenary logic, but it’s actually less complicated. Mercenaries get paid for their expertise, but the Air Force doesn’t really check on expertise when it declares a pilot bonus-eligible. Strong performers don’t get more than average performers. Extra qualifications don’t mean extra cash. Commanders can, with considerable justification, stand in the way of a bonus for a demonstrably weak performer, but they can’t limit the number of years or the dollar amount awarded. There’s no calibration. A pilot finds herself in a defined bureaucratic bin and is consequently eligible or ineligible. The Air Force’s personnel staff retains the pilot or doesn’t, and commanders are left to piece together the futures of their communities based on who decided to hang around.

It costs the Air Force millions in taxpayer funds to create a pilot. Retaining such refined talent is core to combat capability. But the service wrongly believes retention is about dollars, when it's really about sense. Pilots care more about squadron life than the size of a bonus check.
It costs the Air Force millions in taxpayer funds to create a pilot. Retaining such refined talent is core to combat capability. But the service wrongly believes retention is about dollars, when it’s really about sense. Pilots care more about squadron life than the size of a bonus check.

In other words, it’s not so much a mercenary exchange as a commodity trading operation, with pilots regarded more like pork bellies than mid-career professionals. The Air Force’s message to its pilots through this policy is clear: you are not a person or a family, you are a unit of production, and we have monetized your retention thusly. 

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The simplistic approach taken by ARP is also economically inefficient. This is because the target population is not a monolithic commodity so much as a collection of differently motivated subgroups, cognizable in three main categories.

  1. Free Riders. These are people with long-term service aspirations who never had any intention of leaving the Air Force at the end of their initial flying training commitment. They find themselves beneficiaries of a program so blunt it doesn’t care. Content to rake in free money, they sign a bonus that richly rewards them for a commitment they’d gladly have undertaken for free. (Disclaimer: I was a member of this category from 2008-2013).
  1. Grafters. These are the rationalists motivated purely by money, and therefore not by loyalty, values, or leadership aspirations. They do the math and determine whether it’ll pay more to stay in uniform or take an alternative path, and they do as the bottom line commands irrespective of working conditions. Included in this group are some who have not excelled as pilots in the Air Force, and who therefore feel less confident about an airline career than contemporaries further up the performance scale. ARP creates a perverse incentive for these average performers to remain in uniform.  
  1. Fence Sitters. These are the true targets of ARP – strong pilots who have become ambivalent enough about their Air Force futures that economic considerations could pull them off the fence and into civilian life. For these officers, bonus money helps them justify to themselves and their key relationship counterparts the decision to keep service despite the advantages of leaving and despite their misgivings about organizational life.

These categorizations simplify much, even as they demonstrate some of the granularity lacking in the Air Force program and its approach. What they reveal is that the Air Force is pursuing all three groups in order to influence the decisions of just one. In the process, it is giving away millions every year. 

How many millions? No one can say, because the service doesn’t study the program. It simply pays an outside contractor to tell it what percentage of pilots it should attempt to retain based on an algorithm that analyzes airline hiring patterns and then fields a program based on this single element from among all applicable data. In addition to the economic injury, such an indiscriminate effort creates morale problems within the ranks. Airmen sense that some of their pilot brethren are being lavished with a bonus unnecessarily or undeservedly, and they resent it.

The ideal program would pay Group 1 nothing, send Group 2 packing, and manipulate the cost/benefit analysis of Group 3 not with money, but with improvements to working conditions and institutional health such that they become extinct, folding into Group 1.

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The Air Force spent an estimated $75M last year on ARP, only to turn around and commit itself to actively trying to spend even more this year. For that huge sum, it didn’t achieve the result of stalling the unfolding pilot hemorrhage, let alone buy itself a viable strategy for its most consequential career field. That’s because direct compensation of pilots is not the answer to this riddle. Improving squadron life, providing career stability, and reducing operational tempo to a reasonable level are the answers, as Creech’s pilots told Welsh in his recent visit.

For $75M, the Air Force could fund 400 manpower authorizations at the Staff Sergeant level for the next five years to reestablish the organic support squadrons needed to avoid crushing their pilots under the weight of administrative workload. For $75M, the Air Force could pay 250 Warrant Officers to focus and specialize on flying RPAs for five years, which would free 250 fighter and mobility pilots to return to their home communities and alleviate some of the operational tempo at the heart of many separation decisions. Alternatively, the service could shave a million or two off the top and conduct a deployment audit rather than continuing stamp approval on every request for combatant command support in perpetuity. Unnecessary deployments are acidic to morale, and much more responsible for pilot departures than airline hiring. If the service studied the problem in earnest or even just listened to its own pilots, it would know this already.

Fielding a corps of Warrant Officers to operate RPAs would almost certainly be more cost-effective than pulling officers from other communities, and the resulting stability could enhance pilot retention across the force. Despite these arguments, Gen. Welsh shot the idea down during a recent pilot roundtable at Creech AFB.
Fielding a corps of Warrant Officers to operate RPAs would almost certainly be more cost-effective than pulling officers from other communities, and the resulting stability could enhance pilot retention across the force. Despite these arguments, Gen. Welsh shot the idea down during a recent pilot roundtable at Creech AFB.

$75M will buy a lot of things, but it won’t buy Welsh or his fellow senior leaders an excuse. There simply is no excuse for the greatest Air Force in the world to mismanage itself into the inability to execute its mission for lack of pilots.

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Fortunately, the best advice in this situation is free, and ironically culled straight from the archives of pilot wisdom. It is said that good pilots rely on their superb skill for survival, while great pilots rely on wits and planning to avoid situations that would require superb skill for survival.

The Air Force needs to stop performing radical maneuvers every budget year to cobble together a numerically sufficient pilot corps and instead come up with an intelligent, informed, long-term plan to manage its most critical capability in both quantitative and qualitative dimensions. The nation’s defense can’t be allowed to rest on the “superb skill” of an annual pick-up game animated by panic, confusion, and waste.


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