The Role of Education Benefits in Supporting Veterans as They Transition to Civilian Life

Airman Dalton Shank, 5th Bomb Wing public affairs specialist, reads pamphlets on the Montgomery GI Bill and the Post-9/11 GI Bill at Minot Air Force Base, N.D., March 10, 2017.

Photo by Airman 1st Class Alyssa Akers

Every year, close to 200,000 active-duty service members leave the military and join the community of American veterans. A key component of the compensation and benefits that these veterans receive is funding for post-service education, including through the Post-9/11 GI Bill. There is evidence that these benefits have a positive impact on veterans' transitions to civilian life and educational attainment, but there has been no systematic data collection on veterans who use these benefits, their transition experiences, or their long-term outcomes.

Education benefits for veterans represent a large investment for the federal government. To date, more than $400 billion in education benefits has been provided to around 25 million beneficiaries (Bogue, 2021). Under the Post-9/11 Veterans Educational Assistance Act of 2008, also known as the Post-9/11 GI Bill, the federal government allocates more than $10 billion per year to support veterans' education (CBO, 2019).

Leaving the military represents a major life change for veterans and their families. Although many service members choose to retire after a military career of 20 or more years, the most common exit point is after the first term. A typical enlisted service member makes this transition around the age of 23 and without a four-year college degree. This transition often involves moving away from a military community and changing jobs or even occupations—perhaps because a service member's military occupation does not exist in the civilian sector or because the service member seeks a change in career path (Shulker, 2017; Wenger et al., 2017). On a survey by the Institute for Veterans and Military Families at Syracuse University, 55 percent of service members reported that they intended to pursue a career that differed from their military specialty (Zoli, Maury, and Fay, 2015).

A Brief History of Education Benefits for Veterans

The first major bill to provide education benefits to veterans was the 1944 Servicemen's Readjustment Act (commonly known as the GI Bill). This policy was developed during an era when some 16 million World War II veterans were transitioning back to civilian life. In the decades since, education benefits for veterans have been adjusted in various ways, such as through the 1984 Montgomery GI Bill and the current Post-9/11 GI Bill.

The Post-9/11 GI Bill can be characterized as a generous benefit; like the original GI Bill, it covers not only tuition but also living expenses. The Post-9/11 GI Bill also breaks new ground by allowing recipients to transfer some or all of their benefits to spouses or children. The U.S. Department of Veterans Affairs (VA) estimates that 900,000 veterans and dependents draw on these benefits each year (VA, 2020), and other estimates suggest that 40 percent of eligible veterans make use of the program (Kofoed, 2020; the study used data on Army beneficiaries only). Unlike the Montgomery GI Bill, which required service members to pay into the program during their first year in the military, eligibility is determined by a service member's period of service.

Service members who qualify for benefits under the Post-9/11 GI Bill generally receive 36 months of funding, although recent adjustments have provided additional time for certain STEM (science, technology, engineering, or mathematics) subjects. Congress has also taken steps to make it easier for National Guard members and reservists to qualify and has removed the previous 15-year time limit to use the benefits (Pub. L. 115-48, 2017). In the wake of these changes, the Post-9/11 GI Bill is sometimes referred to as the "Forever GI Bill."

Pressing Issues

Education benefits likely ease military-civilian transitions, but there has been little research on their specific contributions.

Over the past 75 years, education benefits have served as one of the primary policy tools to assist service members as they transition to civilian life. The majority of young workers in the U.S. labor market have some postsecondary education, and the earnings advantage for workers with a college degree has increased over the decades (Autor, 2014). Thus, education benefits could be necessary for veterans to maintain or improve their positions in society. These benefits could also increase veterans' access to careers that are not open to those without postsecondary education. To the extent that military skills do not translate easily to the civilian world, obtaining additional education could help veterans gain skills that are more easily recognized in the civilian labor market. Education benefits can also allow veterans to explore and learn about a variety of civilian jobs and occupations. And, of course, they serve as another form of compensation for veterans. Eligibility for spouses is another important component of education benefits; military spouses' career trajectories often suffer as a result of frequent moves and other service-related demands (Hosek and Wadsworth, 2013). Finally, education benefits could encourage young people to enlist in the military (or encourage their parents to support the decision).

Few studies have followed service members through the military-civilian transition, so it is unclear exactly how education benefits assist veterans and their dependents.

The research that does exist suggests that education benefits have had a positive effect on veterans' transitions from military to civilian life over the decades (Bound and Turner, 2002; Angrist, 1993; Angrist and Chen, 2011). These benefits could play an even more important role today, for several reasons. Service members have longer military careers, on average, than those who fought in earlier conflicts during the era of conscription. Today's veterans face a civilian economy that rewards education at a time when fewer Americans are able to achieve a middle-class lifestyle (Zaber and Wenger, 2021; Autor, 2014). Coupled with these broader trends, some veterans encounter a variety of challenges during their transition to civilian life, including homelessness, unemployment, mental health challenges, and suicide risk (Perl, 2015; Savych, Klerman, and Loughran, 2008; Loughran, 2014; Heaton and Krull, 2012; RAND Corporation, 2019; Ramchand, 2021).

Of course, many of these challenges are complex, but there are indicators that veterans in general fare as well or better than their nonveteran counterparts across many outcomes. For example, although recent veterans are more likely to be disabled, they are also more likely to be employed, to have health insurance, and to be enrolled in school (Gumber and Vespa, 2020). In short, education benefits have the potential to play a key role in successful transitions, and their importance has likely increased over time.

It is difficult to identify who uses education benefits to support the transition from military to civilian life.

Today, there are about 18 million U.S. veterans, roughly 4.5 million of whom served after September 11, 2001 (Bureau of Labor Statistics, 2021). The typical enlisted service member enters the military at 18–19 years old. Although many service members spend at least 20 years in the military, the most common exit point is around the end of the first term of service, after they have served no more than five years (Office of the Under Secretary of Defense for Personnel and Readiness, 2020, Tables B-1 and B-40). This transition poses challenges for many service members, but it could be even more difficult for those who retire after a full military career, because military retirement occurs at a point when most American workers have many productive years remaining.

Most large civilian data sets provide few details on veterans' military service. For example, they do not distinguish between those who served in the enlisted ranks and former officers, nor do they indicate whether veterans used education benefits. However, it is clear that post-9/11 veterans have higher levels of educational attainment than their nonveteran counterparts, as shown in Figure 1. Military data indicate that roughly 90 percent of these veterans served as enlistees, and the vast majority of enlistees lack a college degree when they enter the military. Collectively, this suggests that many veterans obtained additional education either while in the military or after transitioning to civilian life. The Tuition Assistance Program provides funds for those who wish to enroll in college during military service, typically to complete introductory coursework (Wenger et al., 2017).

Educational attainment	Post-9/11 veterans	Nonveterans
High school or less	22%	37%
Some college, no degree	48%	33%
Bachelor's degree or higher	30%	30%

SOURCE: Data from the American Community Survey, in Gumber and Vespa, 2020.

Service members who leave the military when the labor market is weak—as it was in 2020—or during recessions experience sizable and long-term negative effects on earnings (Bureau of Labor Statistics, 2021). Today's new veterans have access to generous and flexible education benefits through the Post-9/11 GI Bill, but evidence of the overall effectiveness remains scarce to date. Given the economic volatility since the onset of the COVID-19 pandemic, developing a better understanding of the effectiveness of education benefits for veterans and who is making use of them is an especially timely goal.

Military education benefits have historically improved long-term outcomes for veterans, but post-9/11 veterans' outcomes are understudied.

Education benefits have played a key role in past veterans' successful transitions to civilian employment. The original GI Bill substantially increased the college completion rate among World War II veterans. Vietnam War–era veterans who used education benefits had higher levels of educational attainment than others, and the benefits helped offset the negative earnings effects of lost civilian labor market experience (Bound and Turner, 2002; Angrist, 1993; Angrist and Chen, 2011; Barr et al., 2021). The effects were far-reaching: The children of veterans who received benefits had better educational outcomes than similar children whose parents were not eligible for benefits (Page, 2006). At that time, GI Bill benefits could not be transferred to dependents.

It is important to note that these experiences were not shared by all veterans. African American veterans faced discrimination in using the benefits they earned in uniform. Analysis by McKenna (2008) shows how these barriers dramatically limited the number of African American veterans who were able to access education and home loan benefits that were part of the GI Bill, and Onkst (1998) describes the difficulties—both racial discrimination and insufficient administrative support—that African American veterans in the Deep South encountered after World War II.

Less is known about veterans' experiences with the Post-9/11 GI Bill, but the evidence to date suggests that it has increased college enrollment. The evidence on degree attainment is less clear. In some cases, education benefits appear to have encouraged veterans to attend four-year colleges or more-selective institutions than they otherwise would have (Barr, 2015, 2019; Steele, Salcedo, and Coley, 2010). Research also suggests that veterans who use Post-9/11 GI Bill funds at for-profit institutions receive a relatively low payoff in terms of future earnings, and these veterans may be less likely to complete their degrees (Barr et al., 2021; Kofoed, 2020). This is consistent with a broader literature, which has found that students at for-profit institutions often have poorer outcomes (Deming, Goldin, and Katz, 2012; Cellini and Chaudhary, 2014). However, work by Steele, Salcedo, and Coley (2010) has found that school location, flexibility, ease of transfer credits, and a focus on adult learners were key considerations for veterans when choosing a school; for-profit institutions seemed better able to offer some of these features.

Since the Post-9/11 GI Bill was passed, for-profit colleges have been incentivized to attract and retain veterans who use military education benefits. To some extent, this was driven by a U.S. regulation that no more than 90 percent of a for-profit school's revenue could come from federal aid sources, but Post-9/11 GI Bill funds did not count toward this 90-percent limit. The purpose of the "90-10 rule" was to ensure that for-profit schools could not rely completely on federal funds, although there is some indication that these schools changed their behavior in response, such as by raising tuition costs (Baird et al., 2020). The American Rescue Plan Act of 2021 (Pub. L. 117-2, 2021) addresses this loophole, and Post-9/11 GI Bill benefits will begin to count toward these schools' 90-10 calculation in 2023. This could change how for-profit educational institutions market themselves to veterans.

Despite initial disparities in veterans' educational attainment, they eventually catch up to their nonveteran peers.

There are comparatively more data on veterans' patterns of educational attainment than on their use of military education benefits. Recall that veterans are more likely than nonveterans to attend college and about as likely as nonveterans to have completed a four-year (bachelor's) degree program or higher (e.g., master's degree, professional degree, Ph.D.). But this simple comparison across all veterans masks some key differences. There are no large data sets that track the educational attainment and education benefit use of a group of veterans over time. However, using American Community Survey (ACS) and U.S. Census data over a 20-year period, it is possible to measure the educational attainment of veterans and nonveterans in the same birth cohort over time. The following analysis focuses on veterans and nonveterans born between 1978 and 1980 and examines the timing of their college degree attainment from 2000 to 2019.

As Figure 2 shows, veterans born between 1978 and 1980 obtained at least as much education as their nonveteran counterparts—eventually. At younger ages, the veterans had much lower levels of college degree attainment than the nonveterans. It took the veteran cohort more than 15 years to catch up, but the veterans achieved parity with the nonveterans by age 40. The veterans in Figure 2 would have left the military sometime after 9/11. Most would have qualified for benefits under the Post-9/11 GI Bill, although those who exited after a single term would not have known this until later, given that it was signed into law in 2008.

The overall pattern of educational attainment shown in Figure 2 is consistent with findings from earlier research. The fact that most young veterans lack a college degree is not surprising, as the majority enlisted shortly after high school. But research on earlier cohorts of veterans found not only that veterans accrued education more slowly than nonveterans, but also that they earned college degrees at lower rates (Loughran et al., 2011). In contrast, Figure 2 indicates that veterans do catch up to nonveterans, and the increase in educational attainment among this more-recent cohort could be a result of the generosity of the Post-9/11 GI Bill.

Age	Veterans	Nonveterans
20–24	5%	13%
25–29	13%	28%
30–34	25%	33%
35–39	33%	36%
40–41	36%	36%

SOURCE: Calculations from U.S. Census data (Integrated Public Use Microdata Series [IPUMS] ACS 1-year microdata 2000–2019, Census 2000 5% sample microdata). Estimates use ACS and U.S. Census person-weights. See the appendix for more information about the data set and calculations.

Some recent evidence suggests that women and racial/ethnic minority veterans are more likely than others to use education benefits under the Post-9/11 GI Bill (Kofoed, 2020). Exploring this trend in more detail, Figure 3 shows the 1978–1980 cohort veterans' educational attainment at age 40–41, by gender and race/ethnicity. (The appendix includes the level of educational attainment at each age.) Although it is not clear how many of the veterans in Figures 2 and 3 used the Post-9/11 GI Bill, the differences between veterans and nonveterans in Figure 3 are striking. Only White veteran men were less likely than their nonveteran counterparts to hold a college degree by age 40–41. Among Hispanic men and women, veterans were at least twice as likely as nonveterans to hold a college degree by age 40. The next-largest difference was among Black women, with 52 percent of veterans holding a degree by age 40 compared with 29 percent of their nonveteran peers.

Women

Race/ethnicity	Veteran women	Nonveteran women
Black	52%	29%
Hispanic	51%	20%
White	51%	47%

Men

Race/ethnicity	Veteran men	Nonveteran men
Black	30%	20%
Hispanic	28%	14%
White	34%	39%

SOURCE: Calculations from U.S. Census data (IPUMS ACS 1-year microdata 2000–2019, Census 2000 5% sample microdata). Estimates use ACS and U.S. Census person-weights. See the appendix for more information about the data set and calculations.

Some caveats are appropriate in interpreting these findings. The analyses relied on simple descriptive statistics, and U.S. Census data lack detail on military careers. Therefore, it was not possible to control for other key characteristics, such as officer status or length of service. As mentioned, there is no centralized mechanism to track which veterans use Post-9/11 GI Bill benefits or receive support from other military education benefit programs. Nonetheless, the data suggest that the Post-9/11 GI Bill might play an important role in both increasing veterans' educational attainment relative to nonveterans and in eliminating race/ethnicity gaps in college degree status. Research indicates that this puts veterans on a pathway to higher-paying civilian careers. The patterns of educational attainment among veterans also suggest that the recent repeal of the 15-year limit on using Post-9/11 GI Bill benefits could help even more veterans complete a four-year degree program.

Directions for Future Research

The available evidence suggests that education benefits continue to play an important role in service members' transitions to the civilian world. As a group, veterans eventually acquire more education than nonveterans, but they appear to complete four-year degrees over a much longer period. The Post-9/11 GI Bill is a generous and flexible benefit; given the patterns of degree completion, it may even serve to decrease differences in education levels across groups. However, shortfalls in data collection make it difficult to draw definitive conclusions about the extent to which this significant federal investment improves veterans' transitions to civilian life or about its impact on veterans' long-term outcomes. The following lines of research would help address these gaps and improve understanding of veterans' needs.

• Collect longitudinal data on veterans' transition experiences, use of benefits, and long-term education and career outcomes. Available data indicate that the transition from service member to veteran is lengthy. With very few exceptions, existing data sets focus either on veterans' civilian experiences or on service members' military experiences. Civilian data sets generally lack detail on veterans' relevant service experiences. (For example, the largest civilian data sets include substantial numbers of veterans but lack information on basic aspects of their military service, such as enlisted versus officer status, time deployed, military occupation, and education obtained while serving.) Without this information, determining the needs of veterans and the effectiveness of existing policies is very challenging. A veteran panel, designed to be representative of recent veterans, would provide long-term survey data on veterans' transitions, occupational choices, use of education benefits, student debt, access to other training opportunities, entrepreneurship, certifications, and other key topics. Incorporating a design that continuously refreshes the population to include newly transitioning veterans would allow researchers to measure how veterans' experiences change as the labor market changes and as the educational landscape shifts (for example, in the wake of the upcoming revision to the 90-10 rule).
• Study how various military education benefit programs work together to inform policy changes that increase their effectiveness. The Post-9/11 GI Bill accounts for the vast majority of spending on veteran education benefits, but service members and veterans have access to other benefits as well. Many service members earn college credits through the Tuition Assistance Program, and a few veterans still have access to Montgomery GI Bill benefits. The Yellow Ribbon Program increases the funds available for tuition payments that exceed GI Bill limits at some schools. Finally, individual states have programs that provide benefits to veterans and/or their dependents (House et al., 2019). This is a complex landscape, and existing research suggests that early-career service members often do not understand the education benefits that are available to them (Wenger et al., 2017).
• Examine how the specific experiences and skills acquired in the military map onto veterans' post-military experiences. For example, in what areas or occupations do service members acquire knowledge and skills that are valuable for civilian employment? How do veterans use their experience in the civilian labor market? Goldman et al. (2021) studied the types of civilian careers that veterans pursued after leaving the military and found that those who had served in combat arms, medical, supply, and transportation roles had lower civlilian earnings than their peers who had served in other military occupations. Better information about how veterans choose (or are matched with) civilian career paths would inform existing transition programs and could be beneficial to those who counsel service members leaving the military and those who facilitate connections between veterans and civilian employers.

Appendix: Data Analysis Methods

In this appendix, we describe the American Community Survey (ACS) and U.S. Census data used to produce Figures 2 and 3 and present detailed calculations of educational attainment by veteran status, gender, and race/ethnicity (see Table A.1).

The ACS is a nationwide, continuous household survey that captures detailed information on the U.S. population. The survey is administered by mail to approximately 1 percent of U.S. residents each year in survey waves spread equally across the 12 calendar months. We used one-year microdata samples from the Integrated Public Use Microdata Series (IPUMS) ACS for the years 2000–2019 (Ruggles et al., 2021) and microdata from the 5-percent extract of the U.S. Census for the year 2000, also from IPUMS. These individual-level data allow accurate estimates of the characteristics of relatively small populations (such as Hispanic veteran women between the ages of 35 and 39 in a given year). Our sample included individuals from the 2000–2019 survey years who were part of 1978–1980 birth cohorts.

We coded race/ethnicity as follows:

• "Black" used the intersection of race=2 and any value of hispan.
• "Hispanic" used the intersection of all values of Hispanic greater than zero and all race values except Black.
• The "White, non-Hispanic" category used the intersection of race=1 and hispan=0.

This categorization is heuristic but is based on an understanding that some of the most recognizable examples of informal and formal discrimination—even in recent U.S. history—have focused explicitly on Black individuals, so we allowed this self-identified characteristic to take primacy over self-identification as ethnically Hispanic. We identified veterans using the detailed veteran status variable (vetstatd equal to 20–23) and defined bachelor's degree attainment using the detailed educational attainment variable (educd equal to 101–116).

The ACS and U.S. Census data are cross-sectional, meaning that the surveys do not capture data on the same individuals across different years but instead are sent to a random sample of individuals (conditional on a multistage stratification approach to creating a representative sample at relatively small geographies). However, using this feature of the data (random sampling), it is possible to make statistical inferences about average characteristics of subpopulations over time by holding constant certain features of the survey population, such as birth years. The analysis in Figure 2 uses this approach—taking the subsample of each annual data set for people born in a three-year period—to trace a path of educational attainment by age that represents the average educational attainment for the subpopulations of veterans and nonveterans. The analysis in Figure 3 holds birth cohort constant and considers the educational attainment level of individuals in a specific age window: those 40–41 years old at the time of the survey.

The calculations underlying all these analyses used "person-weights" included in the data. These weights are calculated to address differential sampling rates across geographic locations, nonresponse adjustments, and individual sampling probabilities. These weights are recommended to ensure the national representativeness of subsequent analyses.

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