NCPA - National Center for Policy Analysis

Sailors to Bid on Unpopular Posts in Navy Auction

August 13, 2003

The Navy is taking a different approach to keep skilled sailors in the services. It has begun to let them participate in auctions for unpopular posts. The new plan allows the Navy to unleash the power of the free market for its personnel.

Under the old system, an officer with Navy Personnel Command would pick a sailor whose rotation date and skills were a close fit to an upcoming vacancy. Unfortunately, these mandatory postings to unpopular jobs resulted in many sailors leaving the service.

Now, interested sailors "bid" on how much additional money it would take to entice them to accept unpopular postings:

  • The lowest bid does not always win; previous performance and cost to move will also be considered.
  • The ship with the vacancy also has a vote on which sailors' "winning bids" are selected.
  • A sailor's outside education will also be factored into the mix.

Other factors are also being considered such as should a sailor desperately wanting a particular post be allowed to bid a negative amount -- offering to take the post for less than regular pay?

The Navy received special permission from Congress to operate the new services. They have budgeted $150 million dollars over the next four years to cover the increased cost of paying those with winning bids.

Source: Greg Jaffe, "Navy Turns Auctioneer, Lets Sailors Bid for Unpopular Posts," Wall Street Journal, August 11, 2003.

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