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Title: September 4, 2025

GRAY ZONE BRIEF 4 SEPTEMBER 2025

KNOW THY ENEMIES

China's military might. China showcased hypersonic missiles, anti-ship missiles and unmanned helicopters at a massive military parade to mark the 80th anniversary of the end of World War II. At the event, Beijing also unveiled reconnaissance drones, strike drones, wingman drones and several other types of advanced military hardware. In a speech President Xi Jinping hailed his country’s military might as “unstoppable” and called on all nations “to treat each other as equals and support one another to safeguard common security, eliminate the root cause of war and prevent historical tragedies from recurring.” Russian President Vladimir Putin and North Korean leader Kim Jong Un joined Xi at the event, the first meeting involving the leaders of all three countries in more than six decades. Kim was accompanied by his daughter, fueling speculation that she is being groomed as his heir. Kim and Putin held a separate meeting on the sidelines of the event, during which Putin praised the role of North Korean soldiers in recapturing Russia’s Kursk region from Ukrainian forces.

GREECE IMMIGRATION

Refugee restrictions. Greece’s parliament on Wednesday approved a sweeping migration law. Under the legislation, migrants from EU-designated “safe countries” whose asylum claims are rejected must either leave voluntarily or face up to 24 months in detention and fines of up to 10,000 euros ($11,600). The move builds on the conservative government’s push to expedite returns amid rising arrivals from Libya, especially to the islands of Crete and Gavdos. In July, Greece suspended asylum applications for migrants arriving by sea from Africa for three months.

BULGARIA

Another challenge. Opposition parties in Bulgaria plan to file a no-confidence motion against the government amid nationwide protests demanding sweeping reforms. The initiative is led by a pro-EU coalition and backed by nationalist and pro-Russian groups, forming an unusual alliance of ideologically opposed forces. It would be the fifth such vote since the current government took office in January.

RUSSIAN ECONOMIC WOES

Russian tech. The pace of data center construction in Russia is slowing down despite growing global investment in the field. In the first half of this year, the commissioning of new facilities declined by more than half compared with the same period last year amid a lack of corporate financing, stagnating incomes, increasing costs, energy and labor shortages, and a limited number of large players in the market. Many companies are also under pressure from economic sanctions and increased data security requirements.

THE RAMMSTEIN

Support for Kyiv. British Defense Secretary John Healy arrived in Ukraine on Wednesday for talks with Ukrainian Defense Minister Denys Shmyhal. According to Shmyhal they plan to discuss joint defense projects and an upcoming meeting of the so-called Rammstein group of Ukraine supporters, to be held in London next week.

POLAND LOOKING AT G-20 MEMBERSHIP

Poland's rise. Polish Foreign Minister Radoslaw Sikorski lobbied for Poland’s inclusion in the G20 during his meeting with U.S. Secretary of State Marco Rubio in Florida, the minister said on Tuesday. Earlier the same day, Prime Minister Donald Tusk announced that Poland had entered the “exclusive club” of countries with economies worth more than $1 trillion. Tusk said that Poland’s gross domestic product increased 3.4 percent in the second quarter and that it topped all advanced economies in growth of real disposable income per capita since late 2023.

EU TRADE EXPANSION

Expanding partnerships. The EU is deepening trade ties with Latin America and Asia amid continued global trade disruptions. The College of Commissioners on Wednesday formally adopted the EU’s initial trade agreements with the Mercosur bloc – which is set to create the world’s largest free trade zone, covering 700 million people – and Mexico. The European Commission is also pushing to finalize trade pacts with India and Indonesia by the end of this year and expand links with Southeast Asian countries such as the Philippines, Malaysia and Thailand.

KOREA

Trade diversification. South Korea plans to reopen its strategic review on joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, the country’s Industry Ministry said.

Seoul had wanted to join the Japan-led trade bloc in 2022 but failed to submit an official application due to opposition from the agriculture and fisheries sectors and its strained ties with Tokyo. The ministry also unveiled a plan to provide up to 570 billion won ($410 million) in emergency financial aid this year to help South Korean companies cope with the United States’ imposition of 50 percent tariffs on all steel and aluminum imports.

UN TRADE & DEVELOPMENT 2025 REPORT

Year of disruption. Relatedly, a new report by the U.N. Trade and Development organization highlights the destabilizing effects of growing uncertainty in global trade policies. The overall result of the changes this year in tariffs, subsidies and other restrictions has been higher costs, weaker growth, financial instability and eroded trust. Importers’ efforts to “front-load” ahead of tariff deadlines have intensified the disruption, especially for least developed countries that lack flexibility.

COLLEGE GRADS & UNEMPLOYMENT

This chart (see chart) compares the unemployment rate of recent college graduates (ages 22 to 27) with that of all workers in the U.S. from 1990 to June 2025, using data from the Federal Reserve Bank of New York.

New College Grads See Higher Unemployment Rate:

From 1990 through most of the 2010s, new grads typically enjoyed lower unemployment than the overall national unemployment rate.

Just before the COVID-19 pandemic new grads briefly had a higher unemployment rate, with AI advances post-pandemic exacerbating the trend.

In June of 2025, recent college grads faced a 4.8% unemployment rate, higher than the 4.0% rate for all workers.

GZB INFOCUS:

GLOBAL MILITARY RECRUITMENT CHALLENGES IN THE ANGLOSPHERE: THE WEST IS STRUGGLING

Many militaries in the world have a personnel problem. The British government, for example, has said for years that it doesn’t just need more troops; it needs a different composition of troops as technological advancements create new positions. And though London may feel the pinch most acutely, the problem extends well beyond its borders.

Australia has fallen short of its recruitment goals for the 14th straight year – despite boasting a record number of enlistees in the past 12 months. Canada and New Zealand have issues, too, with a shortfall of 10,000 personnel and a 16 percent attrition rate, respectively.

The United States has fared better, increasing its recruitment by 10 percent year over year, but only after similar long-term declines.

Though these shortcomings in manpower have been observed for some time, it wasn’t until the conflicts in Ukraine and the Middle East and the growing concern over China that these governments felt a keener sense of urgency. The Trump administration’s agenda to rely more on allies for regional defense has only affirmed their resolve. New recruitment efforts are now underway, especially in the United Kingdom and Australia, which are struggling to appeal to a younger generation’s nationalism and willingness to serve in the military.

The problem is twofold: recruitment and retention, both of which are all the more difficult in increasingly technologized militaries. Recruiters have looked to capitalize on new outreach methods, including TikTok, social media influencers, and video games, to motivate applicants, but shortfalls remain. The U.K. and Australia have also experimented with more flexible service models that compete with private industry for more attractive careers. London has piloted short-term and part-time enlistment tracks to encourage recruits who are unwilling to commit to long-term service. Australia has expanded lateral entry programs, allowing individuals with specialized technical skills to bypass traditional entry-level training and join at higher ranks. The U.S. has doubled down on financial incentives for retention and relies on advertising to fill recruitment numbers.

Maintaining a steady intake of new troops is essential not only to preserve troop numbers but also to sustain intergenerational transfers of skills and institutional knowledge. Modern militaries are structured around layered experience; junior personnel learn required skills from non-commissioned officers and commissioned leaders. Poor retention of staff risks brain drain and the erosion of hard-won expertise. Losing skilled or trained soldiers, especially in high-skill areas, is often more damaging than failing to recruit new ones.

Other problems stem from recruitment objectives.

Sustained shortfalls can disrupt compositional balance. A military that becomes disproportionately top-heavy risks fielding highly experienced leaders without younger ranks to operationalize their directives, thereby eroding readiness and capacity. Wars cannot be won by senior officers alone if their contingents are not adequately staffed by competent underlings who can reliably execute their orders. (There are signs that the British military is already trending toward this kind of imbalance.)

Another factor is new positions. Fields such as cyber readiness capabilities, information technology and networking, and software and computer engineering haven’t always been associated with military service. But recent conflicts, such as the war in Ukraine, highlight the vital role of drone manufacturers, drone operators and other similar specialists. Operating this kind of technical equipment takes years of training. New drone fleets for the members of AUKUS – the trilateral security partnership of the U.S., the U.K. and Australia meant to promote freedom of navigation in the Indo-Pacific – are required to be manned by both existing troops and new recruits.

All three countries are now focusing on this issue, albeit in different ways. The U.S. has invested massive amounts of money in marketing campaigns – as much as $600 million annually – and has offered incentives like student loan repayment. It has also pursued long-term digital partnerships with the likes of TikTok and YouTube. These strategies have been fairly effective among a larger population base that wants income stability. U.S. recruitment numbers surged in 2024, but analysts are skeptical that the trend will continue.

In Australia, recruitment and retention problems have been driven for years by structural and organizational factors such as rigid hierarchy, difficulty with posting cycles and a limited number of eligible applicants. Low unemployment numbers are also a factor as younger generations work in private industries without the personal cost of military service.

Increases in remuneration packages are unlikely to tip the scales since payment in the Australian military is already pretty generous. (The starting salary of a sergeant or fully qualified officer is higher than the national median.)

The Australian military aims to boast 69,000 members by 2030 and 80,000 members by 2040. The 2024-25 fiscal year put the total number of full-time personnel at 61,189. This means the recruitment rate will require a substantial boost to achieve the government’s goals. Australia has thus considered opening up military recruitment to permanent residents and citizens from Five Eyes partners – the U.K., the U.S., Canada and New Zealand – to broaden the applicant pool and address shortfalls. And the shortfalls are significant. A report from April showed that only 16 percent of eligible-aged recruits (17-24) would satisfy the entry requirements – absence of physical and mental disability, macro-health concerns, criminal history, drug use and minimum education levels – and would thus be inclined to apply for service. That number could be even lower since, according to a survey from 2024, only about one in six said they would volunteer to defend Australia if attacked. Even those who do apply face issues such as slow processing time, during which they find other opportunities for employment.

The U.K. is facing even starker challenges. In 2024, Defense Secretary John Healey said the armed forces were losing 300 more full-time personnel than they were recruiting every month. Parliamentary Undersecretary of State for the Armed Forces Luke Pollard said the current administration had “inherited a crisis in recruitment and retention.” Recent surveys have shown that active service member morale is at an all-time low; some 58 percent of military personnel rated their service morale as "low" or "very low" in a 2024 survey. Between 2010 and 2023, the army alone had a shortfall of over 22,000 personnel. This could complicate Pollard’s recruitment goal of 198,000 for 2024-25.

Low morale has created an image problem for members of Gen Z. Surveys indicate that many young people do not see the armed forces as offering meaningful or attractive career opportunities compared with private industry. The perception of military life as rigid, hierarchical and physically demanding is increasingly at odds with Gen Z’s preferences for flexibility, purpose-driven work and a sustainable work-life balance.

Recent surveys also point to a declining trust in state institutions among Gen Z, which affects recruitment, while both Australia and the U.K. still carry reputational scars from the wars in Iraq and Afghanistan. Like the Australian government, London is competing against civilian sectors, particularly in critical fields like technology, health care and engineering that can provide similar pay, greater flexibility and fewer personal sacrifices.

London has undertaken several initiatives to goose recruitment. It has offered a 35 percent pay increase for new recruits, one of the largest pay raises for the military in the past two decades, and to provide family accommodation, childcare assistance and education allowances. It has also offered to remove many old or outdated medical policies that restricted recruitment, and it has formulated a plan to rapidly accelerate processing times, targeting a conditional employment offer within 10 days of application and provisional training within 30 days. And, like Australia, the U.K. has considered widening the pool to attract residents of the British Commonwealth, but it has yet to enact concrete policies.

Australia and the U.K. are learning from successes in the U.S. centered on guaranteeing career stability, and they are investing in partnerships with certain universities and STEM programs to attract skilled graduates. Both are using data-driven processes, increased pay, flexible career options and digital innovation to boost recruitment – especially in critical tech-focused and specialist fields.

Retention programs are also being redesigned, focused as they are on improving posting stability to reduce family disruption, investing in housing quality and providing enhanced education support for dependents. These reforms signal a recognition that recruitment cannot be addressed in isolation – that without credible retention measures, new recruits will simply bleed out of the system after their first contract ends.

Countries outside the Anglosphere are grappling with similar issues. Japan has looked to offset personnel losses with AI, automation and improved salaries and living conditions to attract more young people. Germany passed legislation requiring 18-year-olds to fill in a survey to identify more potential recruits. Nordic countries have had success leaning on conscription to fill ranks in key emerging roles.

Despite these efforts, there will likely be persistent challenges ahead with recruitment unless new incentives can be created or unless unemployment rises.

Ultimately, the global recruitment crisis isn’t just a domestic issue; it carries significant geopolitical implications.

For middle powers like Australia and the U.K., which rely on professional, technologically capable forces to maintain credibility alongside allies, recruitment failures could undermine their ability to meet commitments in NATO, AUKUS, and other collective defense structures that are becoming only more important in America’s new global geostrategy. (Australia’s decision to pursue a smaller number of nuclear-powered submarines rather than a larger fleet of conventional diesel-powered craft under AUKUS was partly driven by staffing issues.)

The real test will be whether militaries can transform themselves quickly enough to align with a generation that values flexibility, purpose and technology. This will also require a commitment to hiring a diverse workforce that is capable of filling the vast number of non-direct combat roles that are now required in emerging technological fields.

Absent that, recruitment shortfalls will be a strategic liability in an era of mounting global instability. If the U.K. and Australia are successful, other Western militaries will probably follow their playbooks. If recruitment and retention continue to falter, the problem will not only weaken national forces but also strain allied burden-sharing in NATO and AUKUS, leaving fewer states able to contribute meaningfully to collective defense in an era of intensifying strategic competition.

Pray.

Train.

Stay informed.

Build resilient communities.

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— END REPORT