The U.S. Army is still having trouble holding on to captains (rank O-3 of ten officer ranks), and majors (O-4). Currently the army is short 4,000 captains and majors. The problem with the captains goes back several years and, not surprisingly, that eventually led to shortages of majors.
In an effort to entice captains to stay in uniform, $20,000 bonuses were offered to 7,000 army captains. That helped, but not enough. Budget cuts mean the bonus program won't be available in the future, and the rising unemployment rate for civilians is not causing enough captains to stick around.
Captains have been leaving the service at higher than wanted rates for nearly a decade now. There are several reasons for this. First, there are better opportunities in the civilian economy, even during a recession. These captains have been in the army less than ten years, and are far enough away from the 20 year mark (when they are eligible for a half-pay pension), to be able to leave without feeling much fiscal pain.
Then there's the war, and the constant trips overseas. Captains usually have families, with young children, and wives (or husbands) who are overwhelmed when left alone with the kids. The kids are only young once, and even with Internet access, there's a lot you miss if you're away.
There's still a generation gap between the junior officers (the captains are the most senior of that lot) and the generals. The younger officers have had it with the "zero tolerance" and political correctness crap. Actually, a lot of that has been ditched because of the wartime conditions. But there's still the feeling that your boss will hang you out to dry if the media makes a fuss about something you didn't do, but someone thinks you did.
The U.S. Marine Corps is having similar problems, and offered a $4,000 bonus for captains who will stay in when their contracts expire this year. Normally, the marines lose about 500 captains each year. This is a major loss, as it takes at least four years of service, training and experience to create a captain. The hope is that the bonus will persuade 300 captains to stay in. This is necessary because the marines are expanding from 186,000 troops, to 202,000. They also have the largest number of combat experienced captains since the early 1970s, and they want to keep these officers in, as their battlefield knowledge will stay with them throughout a 20-30 year career. This can save lives, because this experience is invaluable as these officers train and lead troops in the future.
It can takes six years of service for someone to become a captain, if you take a sergeant and put them through Officer Candidate School. Most officers come from the service academies or ROTC, in which case it takes about eight years. That's not just a lot of time, but a lot of money. It's cheaper to offer big bonuses to keep these junior officers in uniform.