NPR reported last month that, for the first time in five years, the U.S. Army had more than met its recruiting goals.
This happens every time unemployment rises, and it should be absolutely no surprise. People choose military service after high school partly out of a desire to serve the country; but there is strong evidence that incentives matter.
Higher pay increases the supply of enlistees, and so does a reduced opportunity cost — the value of potential enlistees’ time in other activities. Higher unemployment is especially heavily concentrated among young workers; the alternatives for high-school graduates in a recession are reduced, and the military becomes a more attractive option.
So I would be happy to bet that the Army will have even less trouble meeting enlistment goals in 2009, provided its demand for enlistees does not increase too much.
Other supply behavior is countercyclical too — and typically includes enrollment in economics courses. So the recession should increase the demand for teachers of intro economics, like me. An ill wind blows a bit of good!